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HCA 474/2019
[2026] HKCFI 3593
IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF FIRST INSTANCE
ACTION NO 474 OF 2019
________________________
BETWEEN
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CHUA EH FONG |
Plaintiff |
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and |
|
| |
CHOW HAI YEN |
1st Defendant |
| |
HUANG YOULONG (黃有龍) |
2nd Defendant |
________________________
| Before: |
Deputy High Court Judge Alan Kwong in Open Court |
| Dates of Hearing: |
5, 8-9, 18 June 2026 |
| Date of Judgment: |
30 June 2026 |
________________________
J U D G M E N T
________________________
A. Introduction
1.This action concerns the gambling debts incurred by the 2nd Defendant at a casino in Perth, Australia (the “Casino”).
2.The crux of the parties’ dispute is (i) whether the Plaintiff (or the persons allegedly represented by the Plaintiff) personally entered into agreements with the 2nd Defendant for providing him with gaming credit; and (ii) whether the Plaintiff (or the persons allegedly represented by the Plaintiff) is/are entitled to charge interest at 24% p.a. against the 2nd Defendant in regard to the indebtedness relating to the gaming credit.
B. The Plaintiff’s Case
B1. The Parties
3.The Plaintiff was, at all material times prior to May 2015, the vice president of marketing of Crown Resort Pte Ltd, which was an entity within the Crown group of companies (“Crown”).
4.The Plaintiff’s job duties included arranging or procuring high-end customers to patronize the casinos operated by the Crown. She was also responsible for arranging gaming credit for these customers.
5.The 2nd Defendant was a well-known and wealthy businessman. According to media report, the 2nd Defendant owned a private jet. Whilst he was a friend of the famous entrepreneur Mr Jack Ma (馬雲), he was the husband of the famous movie star Ms Zhao Wei (趙薇).
B2. The 1st Credit Agreement
6.In late February 2015[1], under the Plaintiff’s arrangement, the 2nd Defendant visited the Casino, which was operated by Crown.
7.According to the Plaintiff, the 2nd Defendant asked her to provide gaming credit. However, at the time, the 2nd Defendant owed substantial gaming debts at other casinos and to other junket operators. Thus, Crown was unwilling to grant gaming credit in favour of the 2nd Defendant, and indicated to the Plaintiff that she should look for an intermediary to take up the credit risk relating to the 2nd Defendant.
8.It is not in dispute that Sun City Gaming Promotion Co Ltd (hereinafter “Sun City”) was a junket operator that was involved in the business operation of the Casino, and the Plaintiff had a business connection with Sun City.
9.Whilst the sole shareholder of Sun City was Mr Chau Cheok Wa (周焯華) (“Mr Chau”), the Plaintiff’s mother, namely Ms Lim Sui Mee (“Ms Lim”), and cousin, namely Mr Si Chong Su (“Mr Si”), were Sun City’s investors. It appears that the Plaintiff had a close relationship with Mr Chau. Whilst the Plaintiff was referred to as Mr Chau’s “cousin”, they are not related by blood at all.
10.The business arrangement between Ms Lim and Mr Si (as investors) and Sun City was as follows: -
(1) Ms Lim and Mr Si had invested or deposited substantial amounts of monies with Sun City, which could be used to “guarantee” gaming chips that Sun City made available to gaming customers.
(2) Ms Lim and Mr Si might give credit to gaming customers up to the amount of deposits that they had placed with Sun City, and before such credit is repaid, the corresponding amount of their deposits would be frozen and could not be utilized for other gaming customers.
(3) For each customer brought in, Ms Lim and Mr Si would be entitled to a share of the “junket commission” that would be received by Sun City from the casino, and the same shall be calculated by reference to the turnover of the gaming customer.
(4) Whilst Ms Lim and Mr Si should be responsible for collecting the outstanding credit from the gaming customer (plus any applicable interest), Sun City would look to Ms Lim and Mr Si for repayment.
(5) Ms Lim and Mr Si were free to agree on different terms as to repayment with the gaming customer (such as charging a higher rate of overdue interest).
11.Having said that the Casino was unwilling to offer gaming credit to the 2nd Defendant, the Plaintiff procured herself, Ms Lim and Mr Si to agree the following arrangement with Sun City for the purpose of providing gaming credit in favour of the 2nd Defendant (the “Internal Casino Arrangement”): -
(1) Sun City would obtain credit from Crown in the sum of AUD 40 million by receiving gaming chips from Crown in the same amount. For these gaming chips, Sun City would be responsible for repaying Crown.
(2) Sun City would make available gaming chips in the amount of AUD 40 million to the 2nd Defendant.
(3) Sun City would look to Ms Lim and Mr Si for repayment.
(4) Ms Lim and Mr Si would, through the Plaintiff, look to the 2nd Defendant for repayment (together with any applicable overdue interest).
(5) Whilst Crown would not charge any interest against Sun City in respect of the credit granted to the 2nd Defendant, Sun City, in turn, would not charge any interest against Ms Lim and Mr Si.
12.In the circumstances, the Plaintiff entered into an oral agreement with the 2nd Defendant (the “1st Credit Agreement”) as follows: -
(1) The Plaintiff should procure gaming credit in the amount of AUD 40 million to be provided to the 2nd Defendant at the Casino by way of gaming chips.
(2) In return, the 2nd Defendant should make repayment to the Plaintiff within 3 months from the day of provision of the credit at the exchange rate of AUD 1 to HK$6.30.
(3) Should the 2nd Defendant fail to make full repayment within 3 months, he should be liable to pay interest on the overdue amount at the rate of 24% p.a.
13.On 25 February 2015, the 2nd Defendant flew to Perth in order to gamble at the Casino using the gaming chips of AUD 40 million procured and/or arranged by the Plaintiff pursuant to the 1st Credit Agreement.
14.It transpired that the 2nd Defendant soon lost all these gaming chips at the Casino within 2 days.
B2. The 2nd Credit Agreement
15.In the circumstances, the 2nd Defendant requested the Plaintiff to provide him with further gaming credit of AUD 20 million, and he hoped that he could recover his loss.
16.Accordingly, the Plaintiff, Ms Lim and Mr Si agreed to enter into the following arrangement with Crown and Sun City (the “Further Internal Casino Arrangement”): -
(1) By reason of 2nd Defendant’s previous gaming activities and intended further gaming activities, Ms Lim and Mr Si would be entitled to be paid junket commission.
(2) Taking this into account, Crown would issue gambling chips for a further amount of AUD 20 million to the 2nd Defendant by setting off the same against the junket commissions to which Ms Lim and Mr Si were entitled.
(3) Mr Si and Ms Lim would, through the Plaintiff, look to the 2nd Defendant for repayment of the additional sum of AUD 20 million, together with any overdue interest.
17.In the premises, on 28 February 2015, the Plaintiff and the 2nd Defendant orally agreed that (the “2nd Credit Agreement”): -
(1) The Plaintiff would procure further credit of AUD 20 million to be provided to the 2nd Defendant at the Casino by way of gaming chips.
(2) Should the 2nd Defendant fail to make full repayment within 1 month, the 2nd Defendant should be liable to pay interest on the overdue amount at the rate of 24% p.a.
18.Pursuant to the 2nd Credit Agreement, the Plaintiff did procure gaming chips in the amount of AUD 20 million for the 2nd Defendant.
19.Again, the 2nd Defendant lost all these gaming chips at the Casino.
B3. The Repayments in favour of the Plaintiff
B3(a) Repaying HK$143 million to the Plaintiff
20.During the period from 25 March 2015 to 2 July 2015, the 2nd Defendant caused himself, the 1st Defendant, and his company (namely Wise Dragon Global Group Holdings Ltd (“Wise Dragon”)) to pay an aggregate sum of HK$143,000,000 to the Plaintiff and a company owned by the Plaintiff (namely Marvella Group (HK) Ltd (“Marvella”). The details of the payments are set out as follows:
| Date |
Payor |
Payee |
Amount |
| 25/3/2015 |
2nd Defendant |
Plaintiff |
HK$22,000,000 |
| 27/4/2015 |
Wise Dragon |
Plaintiff |
HK$20,000,000 |
| 15/5/2015 |
2nd Defendant |
Plaintiff |
HK$21,000,000 |
| 29/5/2015 |
Wise Dragon |
Marvella |
HK$40,000,000 |
| 2/7/2015 |
1st Defendant |
Plaintiff |
HK$40,000,000 |
| Total: |
HK$143,000,000 |
B3(b) The 3 Cheques
21.Meanwhile, the 2nd Defendant also caused the 1st Defendant, who was his personal assistant, to draw 3 cheques (the “3 Cheques”) as security for the indebtedness under the 1st and 2nd Credit Agreements, and the same was delivered to the Plaintiff on or around 28 June 2015. The details of the 3 Cheques are as follows: -
|
Date |
Amount |
| 1st Cheque |
28/7/2015 |
HK$60,000,000 |
| 2nd Cheque |
28/8/2015 |
HK$60,000,000 |
| 3rd Cheque |
28/9/2015 |
HK$60,000,000 |
22.As the 2nd Defendant defaulted on making repayments, on 28 July 2015, the Plaintiff inserted her name as payee, and presented the 1st Cheque for payment. However, it was dishonoured.
B3(b) The Regalia Bay Property
23.In around August 2015, the Plaintiff and the 2nd Defendant agreed that the 2nd Defendant should transfer a property at Regalia Bay (the “Regalia Bay Property”) in favour of the Plaintiff as partial repayment of the indebtedness under the 1st and 2nd Credit Agreements to the extent of HK$65 million.
24.It transpired that the Regalia Bay Property was owned by the wife of the 2nd Defendant’s friend, namely Ms Li Shuangtong (“Ms Li”) and the same was worth HK$70 million. As such, the 2nd Defendant agreed to pay this amount and would procure the transfer of the Regalia Bay Property in favour of the Plaintiff.
25.In the circumstances, on 10 August 2015, the Plaintiff and her younger brother (as purchasers) and Ms Li (as vendor) entered into a sale and purchase agreement for purchasing and selling the Regalia Bay Property at HK$70 million (the “SPA”).
26.On 10 August 2015, the 2nd Defendant paid a sum of HK$10 million to the Plaintiff, such that the Plaintiff could pay the deposit under the aforesaid SPA.
27.The Plaintiff then moved into the Regalia Bay Property and began renovating the same.
28.However, the 2nd Defendant did not pay the balance of the purchase price under the SPA[2], and the same had remained outstanding.
29.As Ms Li threatened to terminate the SPA, the Plaintiff used her own funds to pay the balance of the purchase price. Completion of the sale and purchase of the Regalia Bay Property formally took place on 15 September 2017.
B3. The Involvement of Sun City’s Mr Chau
30.In light of the 2nd Defendant’s continuous default, in or around late 2015, Mr Chau, who was the sole shareholder and/or owner of Sun City, intervened. Mr Chau had discussed repayment issues with the Plaintiff and the 2nd Defendant.
31.Due to Mr Chau’s intervention, during the period from 2 February 2016 to 11 November 2019, the 2nd Defendant paid a total sum of HK$273,017,000 to Sun City.
32.In the premises, on 17 September 2019, Sun City executed a deed (the “Deed of Release”) to confirm that the indebtedness of AUD 60 million (ie AUD 40 million plus AUD 20 million) had been fully repaid, and thus the 2nd Defendant had been discharged of all liabilities in respect thereof.
B4. The Stance of the Plaintiff in this Action
33.Whilst the Plaintiff is willing to give credit in respect of the repayments that the 2nd Defendant made to Sun City, the Plaintiff maintains that the 1st and 2nd Credit Agreements are valid and legally binding contracts between the 2nd Defendant and herself (acting in her own capacity or alternatively as an agent on behalf of Ms Lim and Mr Si, being undisclosed principals).
34.As such, the 2nd Defendant should have repaid the indebtedness to the Plaintiff. More importantly, the 2nd Defendant should have paid overdue interest (at 24% p.a.) on the indebtedness to the Plaintiff.
35.Since the 2nd Defendant refused to accept that he had entered into the 1st and 2nd Credit Agreements at all, the Plaintiff sues the 2nd Defendant in these proceedings, claiming the overdue interest on the indebtedness owed by the 2nd Defendant under the 1st and 2nd Credit Agreements.
36.Furthermore, it is the Plaintiff’s case that the 1st Cheque of HK$60 million was drawn as security over the principal indebtedness and the overdue interest thereon under the 1st and 2nd Credit Agreements. Since the said principal indebtedness and overdue interest had not been repaid as of July or August 2015, the Plaintiff was entitled to present the 1st Cheque of HK$60 million for payment. As the 1st Cheque was dishonoured, the 1st Defendant (being the drawer) is liable to her HK$60 million.
C. The Defendants’ Case
C1. No Dispute that Gaming Credit was Obtained
37.The Defendants admitted that: -
(1) The Plaintiff was an employee working for Crown.
(2) Under the Plaintiff’s arrangement, the 2nd Defendant gambled at the Casino, which was operated by Crown.
38.The Defendants also admitted that: -
(1) The 2nd Defendant obtained 2 rounds of gaming credit in the aggregate amount of AUD 60 million (ie AUD 40 million plus AUD 20 million).
(2) The 2nd Defendant lost a total sum of AUD 60 million at the Casino.
C2. The Gaming Credit Indebtedness was Owed to Sun City
39.The forefront of the Defendants’ case is that the aforesaid gaming credit of AUD 60 million was provided by Sun City, and he had not entered into the alleged 1st and 2nd Credit Agreements with the Plaintiff at all.
40.In this connection, the Defendants averred that before obtaining the gaming credit, the 2nd Defendant had telephone conversations with Mr Si, and he was Sun City’s agent in handling the provision of the gaming credit. According to the 2nd Defendant’s understanding, Mr Si’s interest in the transaction was simply his sharing of the “junket commission” payable by Sun City and/or Crown.
41.In the circumstances, since late 2015, the 2nd Defendant had been liaising with Sun City in relation to the repayment of the aforesaid indebtedness relating to the gaming credit (the “Gaming Credit Indebtedness”). The Defendants stressed that whilst Ms Lim and Mr Si were not involved in the liaison, Sun City did not look to Ms Lim and Mr Si for repayment.
42.The Defendants also stressed that the Plaintiff had not advanced any money or credit in her own right to the 2nd Defendant, and, as such, she was not entitled to claim any overdue interest on the Gaming Credit Indebtedness. Indeed, neither Ms Lim nor Mr Si had requested the 2nd Defendant to pay overdue interest on the Gaming Credit Indebtedness.
43.Insofar as the Plaintiff seeks to contend (alternatively) that she acted as the agent of Ms Lim and Mr Si in entering into the 1st and 2nd Credit Agreements, the Defendants suggested that the Plaintiff’s authority had been terminated by Mr Si. In this connection, the Defendants relied on an alleged telephone conversation between the 2nd Defendant and Mr Si in late July 2019, during which Mr Si allegedly said, inter alia, that: (i) the debt allegedly owed by the 2nd Defendant to the Plaintiff had nothing to do with him and (ii) the alleged debt was owed to Sun City or Crown, not the Plaintiff.
C3. Repayments
44.Having said that it is the Defendants’ case that the gaming credit was advanced by Sun City (not the Plaintiff), the Defendants emphasized that upon the pressure exerted by Mr Chau, he liaised with Mr Chau and/or Sun City regarding matters relating to repayments of the Gaming Credit Indebtedness, and the process involved the Plaintiff. It transpired that, with the knowledge of the Plaintiff, the 2nd Defendant made substantial repayments to Sun City, and Sun City eventually executed the Deed of Release to confirm that the entirety of the Gaming Credit Indebtedness had been repaid. This document, the Defendants contended, shows that the contractual dealings relating to the gaming credit were between the 2nd Defendant and Sun City (not the Plaintiff).
45.The Defendants are not in a position to deny the fact that the 2nd Defendant and Wise Dragon (which was owned by the 2nd Defendant) paid an aggregate sum of HK$143,000,000 to the Plaintiff and Marvella (which was owned by the Plaintiff). In this connection, the Defendants’ explanation was that the 2nd Defendant, upon the Plaintiff’s request, made the said payments to the Plaintiff on the understanding that the Plaintiff would pass on the monies to Sun City for discharge of the Gaming Credit Indebtedness.
C4. The 3 Cheques
46.The Defendants admitted that the 1st Defendant drew the 3 Cheques. However, in light of their assertion that the gaming credit of AUD 60 million was provided by Sun City, it is the Defendants’ case that: -
(1) The 3 Cheques were provided as security for the Gaming Credit Indebtedness owed to Sun City.
(2) Accordingly, the 3 Cheques were delivered to the Plaintiff on the conditions that (a) she would hand over the same to Sun City; (b) she would not put in any name as payee; and (c) the same should not be presented for payment unless prior notice was given to the 1st or 2nd Defendants.
C5. The Regalia Bay Property
47.As regards the Regalia Bay Property, the 2nd Defendant did not dispute the fact that he paid HK$10 million in order to facilitate the Plaintiff to acquire the Regalia Bay Property. It is the Defendants’ case that the arrangement that the 2nd Defendant agreed with the Plaintiff was such that whilst the 2nd Defendant would pay HK$70 million to enable the Plaintiff to purchase the Regalia Bay Property under the SPA, the Plaintiff should on behalf of the 2nd Defendant repay HK$65 million to Sun City. The difference of HK$5 million (ie HK$70 million less HK$65 million) was a gift to the Plaintiff (新婚紅包). At the time, the Plaintiff was newly married, and the 2nd Defendant wished to express his gratitude to the Plaintiff for her assistance in dealing with the matters relating to the Gaming Credit Indebtedness owed to Sun City.
C6. The Alternative Case Based on Estoppel
48.For the above reasons, the Defendants refuted the Plaintiff’s assertion that the 1st and 2nd Credit Agreements exist. However, if the 1st and 2nd Credit Agreements exist as alleged, the Defendants contended that the Plaintiff has waived and/or is estopped from exercising her rights to claim interest against the 2nd Defendant under the 1st and 2nd Credit Agreements.
49.In this connection: -
(1) The Defendants relied on, inter alia, following conduct on the part of the Plaintiff: -
(a) she knowingly allowed Sun City to directly negotiate and deal with the 2nd Defendant in regard to the Gaming Credit Indebtedness since November 2015; and
(b) she did not pursue any payment of interest against the 2nd Defendant until December 2019 when she joined the 2nd Defendant in these proceedings.
(2) The Defendants contended that the Plaintiff had, by conduct, unequivocally represented to the 2nd Defendant that: -
(a) She had no interest in seeking timely repayment of the Gaming Credit Indebtedness from the 2nd Defendant.
(b) She left it entirely to Sun City to decide whether to seek repayment from the 2nd Defendant and if so the terms of the repayment.
(c) She had waived or would give up her right to claim interest against the 2nd Defendant.
(3) The Defendants further contended that acting in detrimental reliance on the Plaintiff’s unequivocal representation, the 2nd Defendant changed his position, in that he exclusively negotiated and liaised with Sun City for repaying the Gaming Credit Indebtedness in the belief that no interest would be charged and that the entirety of the Gaming Credit Indebtedness had been repaid.
D. Legal Principles on Assessment of Credibility
50.In Lee Fu Wing v Yan Paul Po Ting [2009] 5 HKLRD 513 at 534, DHCJ Au (as Au JA then was) set out the well-established approach to assessing credibility. In the course of assessing the credibility of a party’s case, the court shall consider the following matters:
(1) whether the party’s case is inherently plausible or implausible;
(2) whether the party’s case is, in a material way, contradicted by other evidence (documentary or otherwise) which is undisputed or indisputable;
(3) where it is shown that a witness has been discredited over one or more matters to which he has given evidence using the above tests, this is relevant to the assessment of his overall credibility; and
(4) the demeanour of the witnesses.
51.In the context of adjudicating a dispute in relation to an alleged oral agreement or understanding, in Joint and Several Trustees of the property of Yeung Wing Sing v Yeung Wing Sing & Anor [2021] HKCFI 2018 at para 26, Recorder Yvonne Cheng SC (as Cheng J then was) pointed out that:
(1) contemporaneous written documents and documents which came into existence before the problems in question emerged are of the greatest importance in assessing credibility;
(2) in deciding whether to accept a witness’s account, importance should also be attached to the inherent likelihood or unlikelihood of an event having happened, or the apparent logic of events;
(3) care should be taken in regard to the consistency of the witness’s evidence with undisputed or indisputable evidence, and the internal consistency of the witness's evidence;
(4) care should be taken in drawing conclusions about truthfulness and reliability solely or mainly from the appearance of a witness or from the assessment of a witness’s character; and
(5) witnesses’ credibility should be tested by reference to the objective facts proved independently of their testimony, and the court should consider their motives and the overall probabilities.
E. Deliberation
E1. Did the Plaintiff, in her Own Capacity, enter into the 1st and 2nd Credit Agreements with the 2nd Defendant?
52.It is the Plaintiff’s primary case that she, acting in her own capacity, personally entered into the 1st and 2nd Credit Agreements with the 2nd Defendant. In gist, whilst the Plaintiff should procure total gaming credit of AUD 60 million for the 2nd Defendant, the 2nd Defendant should (i) repay the Gaming Credit Indebtedness to the Plaintiff and (ii) pay overdue interest at 24% p.a. if the sum of AUD 40 million were not repaid within 3 months and if the sum of AUD 20 million were not repaid within 1 month.
53.Having wholistically examined the apparent logic of events, the inherent probabilities, the objective circumstances, the contemporaneous exchange records, the witnesses’ evidence, and counsel’s submissions, I am unable to accept the Plaintiff’s case that she had personally entered into the 1st and 2nd Credit Agreements with the 2nd Defendant. I prefer the Defendants’ case to the Plaintiff’s case, and I make the following findings: -
(1) The gaming credit of AUD 60 million was provided by Sun City to the 2nd Defendant. The contractual dealings in relation to the gaming credit were between Sun City and the 2nd Defendant.
(2) The Plaintiff had not, in her personal capacity, entered into any contractual dealing with the 2nd Defendant. The alleged 1st and 2nd Credit Agreements did not exist.
(3) The 2nd Defendant had not agreed to pay overdue interest on the Gaming Credit Indebtedness to the Plaintiff, and the Plaintiff is not entitled to charge overdue interest on the Gaming Credit Indebtedness against the 2nd Defendant.
54.My reasons for making the aforesaid findings are as follows: -
55.First of all: -
(1) In their opening submissions, Mr Alexander Tang, together with Ms Regina Yip, (for the Defendants) emphasized the following facts that were hardly controversial: -
(a) The Plaintiff was merely an employee of Crown. She was responsible for arranging and bringing in customers to Crown for gambling. Her job duties included arranging a licensed junket to provide gaming credit for the customers[3].
(b) As accepted by the Plaintiff[4], the gaming credit had to be issued by Sun City which was a licensed junket operator, and Mr Si (who was an investor in Sun City) merely bore the risk within the ranks of Sun City internally.
(c) Before the gaming credit of AUD 60 million was provided, the 2nd Defendant had phone calls with Mr Si[5].
(2) In light of the aforesaid uncontroversial facts, Mr Tang went on to contend that it was inherently unlikely that the 2nd Defendant would seek to enter into an agreement with the Plaintiff personally for providing gaming credit.
(3) I see the force of Mr Tang’s submissions.
(4) Bearing in mind (i) the job duties of the Plaintiff, (ii) Sun City was the only entity that was licensed to operate as a junket operator, and (iii) the involvement of Mr Si (who was Sun City’s investor and who bore the credit risk internally), there was every reason to believe, and it was inherently probable, that the Plaintiff merely acted as: -
(a) Crown’s agent (in arranging the 2nd Defendant to gamble at the Casino); and
(b) the middleman between the 2nd Defendant (who obtained gaming credit as a customer) and Sun City (who provided gaming credit as a junket).
(5) Hence, objectively speaking, it was inherently unlikely that the Plaintiff (who was employed by Crown and who was responsible for arranging the 2nd Defendant to obtain gaming credit) would be treated as the principal who personally contracted with the 2nd Defendant for the provision of the gaming credit.
(6) As pointed out by Mr Tang, it appears that the Plaintiff did not even have the authority to issue or release the gaming credit to the 2nd Defendant. This was why it was necessary to arrange the 2nd Defendant to have telephone calls with Mr Si before the gaming credit could be granted or released by Sun City.
(7) Bearing in mind the objective circumstances canvassed above, in my view, it is artificial to suggest that the Plaintiff would enter into contractual dealings with the 2nd Defendant on a personal basis.
56.Second: -
(1) In the commercial world, payment of interest is usually an arrangement to compensate a contractual party in regard to (i) the credit risk that he takes up and (ii) his inability to use the sum or credit during the relevant period of time.
(2) However, according to the Plaintiff’s pleaded case, she did not take up any credit risk; nor was she deprived of any opportunity to use any sum of money or credit to which she was entitled.
(3) On the Plaintiff’s case, the persons who shouldered the credit risk and were deprived of the rights to use the gaming credit maintained with Sun City were Mr Si and/or Ms Lim. According to the Plaintiff, Sun City would look to Mr Si and/or Ms Lim for repayment, and the corresponding amount of their deposits maintained with Sun City would be frozen and could not be utilized for granting credits to other customers[6].
(4) However, there is no evidence showing that Mr Si and/or Ms Lim were keen on recovering the Gaming Credit Indebtedness, not to mention the alleged overdue interest accrued on the Gaming Credit Indebtedness. As Mr Keith Lam, together with Mr Cedric Yeung, (for the Plaintiff) accepted in their opening submissions[7], Mr Si was only interested in his share of the junket commission or share in the profits.
(5) Meanwhile, the Plaintiff also accepted that neither Crown nor Sun City intended to charge any interest[8].
(6) In the premises, it is inherently unlikely that the Plaintiff and the 2nd Defendant would agree that the Plaintiff is entitled to charge overdue interest against the 2nd Defendant. In my view, the Plaintiff’s case does not make commercial sense. It is, at best, logically plausible in theory[9].
(7) It is pertinent to refer to the WeChat message from Mr Chau to the Plaintiff on 2 October 2019[10]. Despite his close relationship with the Plaintiff, Mr Chau obviously took the view that it was not open to the Plaintiff to charge overdue interest against the 2nd Defendant. As such, Mr Chau stated: -
“利息追討應該是出資方的權益，也即是皇冠和太陽城，你當時是在皇冠打工，在皇冠沒有追討利息的情況下，你用什麼身份去代表資方追究呢？如果追回來利息又是屬於誰？”
(8) In my view, Mr Chau’s view made ample commercial sense, and I do see where Mr Chau came from.
(9) For all the above reasons, I find it difficult to accept that the Plaintiff and the 2nd Defendant would agree that the Plaintiff is entitled to charge overdue interest against the 2nd Defendant when the commercial parties who took up the credit risk and who were deprived of the opportunities to use the relevant credits (such as Crown, Sun City, and/or Mr Si) were content not to charge any interest.
(10) All in all, the Plaintiff’s case does not sit comfortably with basic commercial common sense and ordinary logic of events. I am not persuaded that it is credible.
57.Third: -
(1) The contemporaneous WeChat messages from the Plaintiff do not show that she regarded herself as the principal creditor of the Gaming Credit Indebtedness.
(2) On 10 August 2017, the Plaintiff issued messages in a WeChat group that involved the 2nd Defendant. In the context of discussing repayments, the Plaintiff said to the 2nd Defendant that: -
“錢是男哥簽給你的
追回來的錢應該給男哥[11]
男哥再給皇冠[12]” [13]
(emphasis added)
(3) When the 2nd Defendant asked the Plaintiff not to drag him into her personal matters, the Plaintiff said these to the 2nd Defendant: -
“這不是我自己的事，這是事實。
你借錢的時候是找男哥[14]借的吧！
你不是直接找皇冠[15]借的！” [16]
(emphasis added)
(4) The aforesaid WeChat messages are inconsistent with the Plaintiff’s primary case. As of August 2017, the Plaintiff did not consider that she was personally involved in the matters relating to the present dispute in her own right. The Plaintiff even took the view that Mr Si was the one who had the entitlement to receive repayments. As such, the Plaintiff could not have believed that there was any personal contractual dealing and/or creditor-debtor relationship between herself and the 2nd Defendant.
(5) On the face of the aforesaid WeChat messages, the Plaintiff appeared to suggest that the creditor-debtor relationship was between the 2nd Defendant and Mr Si.
(6) However, when these WeChat messages were understood in proper context, it appears to me that what the Plaintiff actually meant was that Mr Si on behalf of Sun City agreed to release the gaming credit in question in favour of the 2nd Defendant. In this connection, the following matters are notable: -
(a) As accepted by the Plaintiff in her supplemental witness statement, “Mr Si was not himself a junket operator so he cannot issue markers in his own name”[17], and the credit was issued by Sun City, “because only Sun City was a licensed junket.”[18]
(b) Against this background, in the aforesaid WeChat messages, instead of saying directly that the 2nd Defendant borrowed money from Mr Si, the Plaintiff merely stated that: (i) the 2nd Defendant approached Mr Si for borrowing money (你借錢[19]的時候是找男哥借的吧); and (ii) Mr Si authorized the borrowing (錢[20]是男哥簽給你的).
(c) In my view, what the Plaintiff meant was that Mr Si (ie 男哥) was the one who agreed that the gaming credit of Sun City be released to the 2nd Defendant.
(d) Indeed, as evidenced by the WeChat message from the Plaintiff on 2 March 2020[21] and the 8 August 2019 Letter[22] (defined below) issued by Sun City, (i) the line of credit that Mr Si maintained with Sun City was under internal account “BB2” and that (ii) the Gaming Credit Indebtedness owed by the 2nd Defendant was booked under account “BB2”
(7) In the premises, the contemporaneous evidence and the Plaintiff’s own assertions support the following conclusions: -
(a) The Plaintiff did not regard herself as the principal creditor in respect of the Gaming Credit Indebtedness owed by the 2nd Defendant. She did not take the view that she had entitlement to receive repayments.
(b) Mr Si was the one who authorized Sun City to grant the gaming credit of AUD 60 million to the 2nd Defendant.
(c) This was why the Gaming Credit Indebtedness owed by the 2nd Defendant was booked under account “BB2”, which represented Mr Si’s line of credit maintained with Sun City.
(d) The creditor-debtor relationship in regard to the Gaming Credit Indebtedness was between the 2nd Defendant and Sun City.
(e) Whilst Mr Si might enjoy certain rights and/or economic interests viz-a-viz Sun City as a result of the transactions (such as sharing junket commission), it was not the case that Mr Si had entered into personal contractual dealings with the 2nd Defendant.
58.Fourth:-
(1) When the Plaintiff was asked whether she represented herself or Mr Si during cross-examination[23], the Plaintiff initially said that she represented both herself as well as Mr Si and Ms Lim.
(2) However, when this court pointed out to the Plaintiff that this was not how her case was pleaded, the Plaintiff eventually indicated that she represented Mr Si and Ms Lim[24].
(3) This answer is obviously contradictory to the Plaintiff’s primary case.
59.Fifth: -
(1) The Plaintiff’s pre-litigation conduct was inconsistent with her suggestion that the 2nd Defendant was indebted to her under the alleged 1st and 2nd Credit Agreements.
(2) When the Plaintiff liaised with the 1st Defendant in regard to the 3 Cheques back in February 2019, the Plaintiff’s complaint was that the 2nd Defendant owed her HK$5 million. This sum was the difference between HK$65 million (ie the estimated value of the Regalia Bay Property) and HK$70 million (ie the sum that the 2nd Defendant agreed to pay in order to enable the Plaintiff to acquire the Regalia Bay Property). Some of the relevant exchange between the Plaintiff and the 1st Defendant on WeChat from 15 February 2019 to 26 February 2019 is set out as follows: -
(a) On 15 February 2019 (at 14:56), the Plaintiff stated[25]:-
“這一張支票是你開的，當初黃總欠那個錢的時候，用了你的名字去開了三張支票給我們。然後，但是他現在有一個五百萬一直沒有給我，然後如果。我在想說，你去跟他說一下吧，讓他把這個錢給了我，不然的話，這邊還有你的幾張票，我都不知怎麼處理。” (emphasis added)
(b) On 26 February 2019 (at 15:10), the 1st Defendant responded as follows[26]:-
“搞不懂。你是皇冠那的帳，對吧？他也說皇冠那的帳也還清了。”
(c) On 26 February 2019 (at 15:16), the Plaintiff stated[27]:-
“我現在不跟他對皇冠和太陽城的帳。他現在欠的是當初房子的貸款和他答應補差額部份的錢。” (emphasis added)
(3) In my view, had the Plaintiff’s case in these proceedings been true, what the Plaintiff would have said to the 1st Defendant during the aforesaid exchange on WeChat should be as follows: -
(a) The 3 Cheques were given for the purpose of securing the Gaming Credit Indebtedness, which was owed to the Plaintiff herself.
(b) Although the 2nd Defendant had fully repaid the principal sum in respect of the Gaming Credit Indebtedness, he had not repaid the overdue interest in respect thereof.
(c) Accordingly, the 2nd Defendant was still indebted to herself, and, as such, she was entitled to present the 1st Cheque for repayment.
(4) For reasons best known to the Plaintiff, when the 1st Defendant asserted that the 2nd Defendant had fully repaid the Gaming Credit Indebtedness related to Crown (皇冠那的帳也還清了), the Plaintiff did not: -
(a) refute the 1st Defendant’s assertion;
(b) assert that the 2nd Defendant was still liable to pay overdue interest;
(c) mention that the 1st and 2nd Credit Agreements existed;
(d) mention that she had personally entered into contractual dealings with the 2nd Defendant relating to the Gaming Credit Indebtedness; and
(e) assert that the 3 Cheques were security over the indebtedness owed to her under the 1st and 2nd Credit Agreements.
(5) Instead, the Plaintiff simply asserted that the 2nd Defendant still owed her HK$5 million arising from the dealings in relation to the Regalia Bay Property. Whilst the Plaintiff apparently looked to the 1st Defendant (who drew the 3 Cheques) for payment, she made it clear that the indebtedness that she pursued had nothing to do with Gaming Credit Indebtedness (我現在不跟他對皇冠和太陽城的帳).
(6) The Plaintiff’s stance back in February 2019 was inconsistent with and different from her stance in the present proceedings. There are sound reasons to believe that as of February 2019, the Plaintiff had not yet come up with the idea that the 2nd Defendant is liable to pay her overdue interest pursuant to the alleged 1st and 2nd Credit Agreements. In other words, the Plaintiff’s assertions in these proceedings were afterthoughts.
(7) I do not lose sight of the Plaintiff’s explanation that back in February 2019, she merely wanted to “test the water” and ascertain whether the 2nd Defendant would be willing to make repayments[28].
(8) In my view, there is neither truth nor substance in the Plaintiff’s explanation. Had the Plaintiff wished to “test the water”, what she should have done was to emphasize that: -
(a) even though the principal sum in respect of the Gaming Credit Indebtedness might have been fully repaid, the overdue interest was still outstanding;
(b) the 2nd Defendant was liable to pay her overdue interest pursuant to the 1st and 2nd Credit Agreements; and
(c) as the 2nd Defendant did not pay overdue interest in accordance with the terms of the 1st and 2nd Credit Agreements, she was entitled to present the 1st Cheque for payment.
Without mentioning any of the aforesaid matters, the Plaintiff could not have ascertained whether the 2nd Defendant would wish to honour the alleged obligations under the alleged 1st and 2nd Credit Agreements. There was no point for the Plaintiff to mention the HK$5 million bonus or price difference relating to the Regalia Bay Property.
(9) In light of the contemporaneous messages from the Plaintiff, it appears to me that the truth was that as of February 2019, the Plaintiff took the view that her role was a “middleman”, and she merely cast her eyes on the sum or bonus of HK$5 million relating to the Regalia Bay Property (which was promised by the 2nd Defendant).
(10) Meanwhile, on 14 February 2019, the Plaintiff issued a WeChat message to the 2nd Defendant[29]. Whilst the Plaintiff mentioned that the 1st Cheque was dishonoured, she merely complained that the 2nd Defendant still owed her HK$5 million in regard to the acquisition of the Regalia Bay Property. Again, the Plaintiff did not:-
(a) complain that the 2nd Defendant owed her overdue interest accrued on the Gaming Credit Indebtedness pursuant to the 1st and 2nd Credit Agreements; and
(b) mention that the 1st Cheque (which was dishonoured) was a security over the Gaming Credit Indebtedness and the overdue interest accrued thereon.
This incident further shows that as of February 2019, the Plaintiff merely cast her eyes on the HK$5 million sum regarding the Regalia Bay Property, and it does not appear that the Plaintiff believed that the 2nd Defendant is liable to pay her overdue interest on the Gaming Credit Indebtedness.
(11) Further, it should be mentioned that when the Plaintiff forwarded an electronic copy of the writ in respect of the present action to the 1st Defendant via WeChat on 13 March 2019 (at 13:05), the Plaintiff said this to the 1st Defendant: -
“當初黃總[30]借5500萬還債，還有欠我500萬房子款項，總共6000萬。用你的支票說還款給我沒有兌現，當初也通知你了。”[31]
(12) It is entirely puzzling as to how the alleged sum of HK$55 million that was said to be borrowed by the 2nd Defendant came about. Be that as it may, the important point is that as of the time when the Plaintiff’s legal representatives issued the writ of this action, the Plaintiff still did not assert that: -
(a) the 2nd Defendant was liable to pay her overdue interest on the Gaming Credit Indebtedness pursuant to the 1st and 2nd Credit Agreements; and
(b) since the 1st Cheque was a security over the Gaming Credit Indebtedness that was owed to her, she was entitled to present the same for payment.
(13) I do not lose sight of the Plaintiff’s assertion[32] that when the 1st Cheque was dishonoured back in August 2015, she allegedly contacted the 2nd Defendant on phone and reminded him that he had an obligation to pay overdue interest. However, the alleged telephone conversation was not recorded, and there is no contemporaneous document or record showing that it existed. More importantly, the telephone conversation alleged by the Plaintiff was inconsistent with the contemporaneous WeChat messages canvassed hereinabove: see sub-paragraphs (2) to (12) above. As pointed out, the contemporaneous WeChat messages show that the Plaintiff’s focus was on the HK$5 million bonus or difference relating to the acquisition of the Regalia Bay Property, rather than the overdue interest allegedly owed by the 2nd Defendant. For all these reasons, I do not accept the Plaintiff’s assertion regarding the alleged telephone conversation back in August 2015.
(14) I also do not lose sight of the fact that there was a telephone conversation on 30 July 2019 (which was recorded)[33]. There, the Plaintiff requested the 2nd Defendant to pay interest for the previous 2 years. It was uncertain as to why instead of asking the 2nd Defendant to pay overdue interest on the outstanding parts of the Gaming Credit Indebtedness from 2015 onwards, the Plaintiff simply asked the 2nd Defendant to pay interest for the previous 2 years (ie from 2017 onwards). Be that as it may, it is hardly disputable that the Plaintiff’s request came late, and she did not take action or make demands for a very substantial period of time.
(15) In my view, the Plaintiff’s inaction and/or delay was hardly explicable, and she had failed to put forward any convincing explanation[34].
(16) For completeness, it should be mentioned that Mr Keith Lam drew my attention to the following messages issued by the Plaintiff on 26 September 2017 in a WeChat group that involved the 2nd Defendant. The Plaintiff stated:-
(a) “如果客戶按時還款，皇冠[35]給的還款期限寬鬆，中介人可以分取利息收益，確保中介人在客戶沒有償還皇冠債務期間的利息收入…並且只要太陽城[36]一天不用還錢給皇冠，客人欠款尾數的利息收入應該歸中介人所有。”[37] (emphasis added)
(b) “客人的馬糧還利以及折扣需要男哥[38]和拍檔再協商後決定”[39] (emphasis added)
(17) In my view, the aforesaid WeChat messages do not support the Plaintiff’s case at all:-
(a) In the aforesaid WeChat messages, the Plaintiff did not assert that she had already entered into the 1st and 2nd Credit Agreements with the 2nd Defendant or that the 2nd Defendant is liable to pay her overdue interest at 24% p.a. pursuant to the 1st and 2nd Credit Agreements.
(b) Instead, in the first WeChat message (see subparagraph (16)(a) above), the Plaintiff merely stated that if Crown was lenient on the repayment terms and/or did not request Sun City to make repayment immediately after the patron made repayments, then, the intermediaries should be entitled to the interest income. It is obvious to me that what the Plaintiff meant was that in the event that Sun City earned any interest income as a result of Crown’s leniency or delay in seeking repayment from Sun City, such interest income should be paid to or shared with the intermediaries. Obviously, the Plaintiff’s first WeChat message was directed towards obtaining interest payments from Sun City, not the 2nd Defendant. I cannot see how the Plaintiff may rely on the first WeChat message to support her assertion that she has a contractual right to demand the 2nd Defendant to pay her overdue interest pursuant to the alleged 1st and 2nd Credit Agreements.
(c) As regards the second WeChat message (see subparagraph (16)(b) above), the phrase “客人的馬糧還利” has nothing to do with overdue interest; instead, it refers to the rebate in respect of the junket commission that should be shared with the 2nd Defendant. Indeed, in the first WeChat message, the Plaintiff said this:-
“男哥拍檔：介紹客戶資源，利益收取馬糧1/3，另外1/3馬糧要還利給客人黃有龍[40]。”[41] (emphasis added)
In the premises, it is clear to me that what the Plaintiff meant was that the 2nd Defendant should receive rebate in respect of 1/3 of the junket commission, but the matter would have to be discussed amongst Mr Si and his business partner(s). I cannot see how the Plaintiff can rely on the discussions relating to this matter to suggest that the 2nd Defendant is liable to pay her overdue interest. There is simply no correlation.
60.Sixth: -
(1) It is not in dispute that from November 2015 onwards, Mr Chau of Sun City had been personally involved in liaising with the 2nd Defendant in regard to the repayment of the Gaming Credit Indebtedness.
(2) On 2 January 2016, a meeting (which was recorded[42]) (the “2 January 2016 Meeting”) took place between Mr Chau, Ms Chu (who was an employee of Sun City), the Plaintiff, and the 2nd Defendant.
(3) During the 2 January 2016 Meeting, the parties worked out the outstanding indebtedness that was still owed by the 2nd Defendant and the amounts of monies that the Plaintiff should pay Sun City (對數). The process was complicated as the parties took into account various matters, and adopted various interest rates.
(4) For present purposes, it is unnecessary to dwell on the details of the calculation/verification exercise (對數). The important point is that as evidenced by the transcript in respect of the 2 January 2016 Meeting, throughout the process of the calculation/verification exercise (對數), neither the Plaintiff nor anyone mentioned one single word about the alleged obligations on the part of the 2nd Defendant to pay overdue interest to the Plaintiff pursuant to the alleged 1st and 2nd Credit Agreements.
(5) In my view, the purpose of having a calculation/verification exercise (對數) at the 2 January 2016 Meeting was for the parties to sort out and agree on the sums that they should pay each other.
(6) However, not only did the Plaintiff fail to insist that she has the entitlement to receive the outstanding part of the Gaming Credit Indebtedness directly from the 2nd Defendant pursuant to the alleged 1st and 2nd Credit Agreements, more importantly, the Plaintiff also failed to assert that the 2nd Defendant is liable to pay her overdue interest accrued on the Gaming Credit Indebtedness.
(7) Having said that the 2 January 2016 Meeting was attended by (i) Sun City’s representatives (ie Mr Chau and Ms Chu), (ii) the Plaintiff, and (iii) the 2nd Defendant, this was the best opportunity for the parties to sort out and/or clarify their financial positions viz-a-viz each other.
(8) I am unable to see any sensible reason why the Plaintiff did not assert that under the alleged 1st and 2nd Credit Agreements, the 2nd Defendant is liable to pay her overdue interest accrued on the Gaming Credit Indebtedness. Had the alleged 1st and 2nd Credit Agreements existed, the Plaintiff would have flagged up the matter and sought to work out the figure in respect of the overdue interest, which the 2nd Defendant was allegedly liable to pay.
(9) I do not lose sight of the Plaintiff’s explanations. She asserted that: -
(a) she did not want Mr Chau and/or Sun City to find out the profits that she earned from the transactions, which were sensitive business information; and
(b) the primary purpose of the 2 January 2016 Meeting was to sort out the amounts of monies that should be paid to Sun City.
(10) I do not accept the Plaintiff’s explanations.
(11) Insofar as the first explanation is concerned: -
(a) As demonstrated by Mr Alexander Tang during his opening submissions with reference to the notes jotted by the Plaintiff with her smart phone[43] and an explanation table that helpfully refers to various materials before the court (such as the transcripts in respect of the 2 January 2016 Meeting), it appears that the parties who attended the 2 January 2016 Meeting, including Mr Chau, were clear as to the profits and/or benefit that the Plaintiff and Mr Si earned or derived from the transactions relating to the gaming credit. It is not the case that the information was secretive or opaque.
(b) Further, as evidenced by the transcript in respect of an earlier meeting involving, inter alia, the Plaintiff and Mr Chau that took place on 12 November 2015[44], Mr Chau knew and accepted that the Plaintiff and Mr Si would earn very substantial profits from the transactions relating to the gaming credit. Indeed, Mr Chau’s attitude was encouraging, and he even said that as the 2nd Defendant paid more than what he should pay and Crown received less than what it was entitled to receive[45], there was room for the Plaintiff and Mr Si to earn more profits.
(c) In light of the process of the calculation/verification exercise during the 2 January 2016 Meeting (which was open and candid) and Mr Chau’s attitude (which was encouraging), I do not believe that there were sound reasons to hide the details relating to the alleged 1st and 2nd Credit Agreements from Sun City and/or Mr Chau.
(d) In any event, even if it were necessary to hide the details relating to the alleged 1st and 2nd Credit Agreements (which I do not believe to be the case), there was still no reason why the Plaintiff did not procure the 2nd Defendant to carry out a “side” calculation/verification exercise to sort out and/or clarify the amount of overdue interest that the 2nd Defendant was liable to pay. I cannot discern a good reason why the Plaintiff did not seek to take the opportunity to sort out her financial position viz-a-viz the 2nd Defendant.
(12) As regards the second explanation: -
(a) I accept that as Crown would hold Sun City liable for the indebtedness relating to the gaming credit and the sums would have to be settled, Mr Chau wished to sort out Sun City’s financial position viz-a-viz the 2nd Defendant and the Plaintiff.
(b) However, it does not mean that the Plaintiff would not have wished to sort out her financial position viz-a-viz the 2nd Defendant (had the alleged 1st and 2nd Credit Agreements existed). Having sorted out her financial position viz-a-viz Sun City under the calculation/verification exercise at the 2 January 2016 Meeting, there was every reason why the Plaintiff would wish to confirm with the 2nd Defendant as to the amount of overdue interest that she was entitled to receive.
(c) If the Plaintiff did not want Mr Chau and/or Sun City to be involved, she could have carried out a “side” calculation/verification exercise with the 2nd Defendant that did not involve Mr Chau and/or Sun City. I do not see any good reason why the Plaintiff would wish to leave the matter hanging in the air.
(13) In my view, the most probable explanation was that as of January 2016, the Plaintiff had not yet come up with the suggestion that the alleged 1st and 2nd Credit Agreements exist. The events that took place during the 2 January 2016 Meeting show that the Plaintiff’s alleged entitlement to receive overdue interest from the 2nd Defendant is an afterthought.
61.Seventh: -
(1) The objective conduct on the part of Sun City and/or Mr Chau shows that the contractual dealings in relation to the gaming credit were between the 2nd Defendant and Sun City (not between the Plaintiff and the 2nd Defendant).
(2) As mentioned, it is not in dispute that since November 2015, Sun City and/or Mr Chau had been liaising with the 2nd Defendant for repaying the Gaming Credit Indebtedness, and the 2nd Defendant had made repayments to Sun City directly.
(3) Contrary to the Plaintiff’s assertion, it does not appear that Sun City “looked to” Mr Si and Ms Lim for repayment. Instead, Mr Chau took up the matter himself and liaised with the 2nd Defendant directly. In my view, what was likely to have happened was that Crown held Sun City liable for the gaming credit. In the circumstances, Mr Chau (who was Sun City’s sole shareholder/owner) felt pressurized and hence took action in order to protect Sun City’s interests.
(4) Not only did Sun City receive repayments from the 2nd Defendant directly, Sun City also issued: -
(a) a letter dated 8 August 2019 (the “8 August 2019 Letter”)[46] to put on records, inter alios, that (i) during the period from 25 March 2015 to 10 August 2015, the 2nd Defendant repaid a total sum of HK$153 million through the Plaintiff who was an agent in the transactions and (ii) the 3 Cheques, which were security over the Gaming Credit Indebtedness, would only be cashed if the 2nd Defendant failed to make repayment; and
(b) the Deed of Release dated 17 September 2019[47] to confirm that the 2nd Defendant had already repaid the entirety of the Gaming Credit Indebtedness.
(5) The Deed of Release and the 8 August 2019 Letter demonstrate the contractual relationship between Sun City and the 2nd Defendant. If, as the Plaintiff contended, the contractual relationship was between herself and the 2nd Defendant, Sun City would not have executed and issued these documents at all.
(6) In the premises, the Plaintiff was effectively forced to suggest that the Deed of Release and 8 August 2019 Letter were wrongly issued by Sun City. When the Plaintiff gave oral evidence[48], she even accused Mr Chau and/or Sun City of creating false evidence to support the 2nd Defendant’s defence.
(7) I do not accept the Plaintiff’s suggestion and/or accusation.
(8) Mr Chau was plainly an experienced and sophisticated businessman. As such, I do not believe that Sun City would hastily and/or inexplicably issue some legal documents that did not reflect the commercial reality. In my view, Sun City could not be mistaken as to its legal position and the contractual counterparty that it dealt with.
(9) Furthermore, on the evidence available to the court, I do not see any reason why Mr Chau and/or Sun City would wish to create false evidence and/or issue false documents to corroborate the 2nd Defendant’s defence. Mr Chau and/or Sun City had no reason to do so. It is obvious that Sun City could not have advanced its own commercial interest by issuing the Deed of Release and the 8 August 2019 Letter. Even though the 8 August 2019 Letter was issued upon the 2nd Defendant’s request, it does not follow that the contents thereof are bogus. As mentioned, I am unable to discern any reason why Mr Chau and/or Sun City would wish to issue a document with bogus contents when their economic interests would not be advanced at all.
(10) In my view, Sun City simply executed and issued documents that recorded and reflected its commercial dealings with the 2nd Defendant in the ordinary course of business. This was legitimate. I am of the view that the Deed of Release and the 8 August 2019 Letter carry weight in showing that the creditor-debtor relationship in regard to the Gaming Credit Indebtedness was between Sun City and the 2nd Defendant, not between the Plaintiff and the 2nd Defendant.
(11) For completeness, Mr Keith Lam also disputed the reliability of the Deed of Release. He argued that whilst the internal records of Sun City show that only HK$346,539,878[49] had been paid at the time, the Deed of Release suggests that the 2nd Defendant had already repaid HK$373,000,000.
(12) Despite Mr Lam’s submissions, I am unable to come to the view that the Deed of Release is a bogus and/or unreliable document. As there is no evidence from the staff of Sun City who took records of the 2nd Defendant’s repayment, this court does not know about the booking practice that was adopted, and it is uncertain as to whether there were discrepancies as to the dates when the payments were made and the dates when payments were actually received by Sun City. Be that as it may, for present purposes, I am not of the view that, the alleged discrepancy in respect of the figure is material. In my view, for present purposes, the important point is that had Mr Chau and/or Sun City taken the view that the 2nd Defendant was still liable to Sun City as of 17 September 2019, Mr Chau would not have procured Sun City[50] to execute the Deed of Release. As a sophisticated businessman, Mr Chau must have appreciated that by executing the Deed of Release, Sun City would have no recourse against the 2nd Defendant. As such, Mr Chau would not have procured Sun City to execute the Deed of Release had the 2nd Defendant failed to repay the entirety of the Gaming Credit Indebtedness.
62.Eighth: -
(1) I do not lose sight of the fact that from 25 March 2015 to 10 August 2015, the 2nd Defendant paid an aggregate sum of HK$153 million to the Plaintiff.
(2) However, as mentioned, it is the Defendants’ case that the 2nd Defendant made payments to the Plaintiff upon the understanding that she would pass on the same to Sun City to discharge the Gaming Credit Indebtedness[51].
(3) In my view, the Defendants’ case is credible.
(4) As stated in the 8 August 2019 Letter issued by Sun City[52] (which was addressed to the 2nd Defendant): -
“閣下於2015年3月25日至2015年8月10日期間向本公司在是次借款的代理蔡一鳳[53]支付港幣15,300萬元，以部份償還該債項。”
(5) The 8 August 2019 Letter shows that the Plaintiff was treated or regarded as the agent in regard to the transactions that gave rise to the Gaming Credit Indebtedness, and the sum of HK$153 million that she received would be counted towards the repayment of the Gaming Credit Indebtedness.
(6) In the premises, the Plaintiff was Sun City’s agent in receiving the sum of HK$153 million from the 2nd Defendant, and it follows that she had to account for the same to Sun City.
(7) In this connection, there is not a shred of documentary evidence to substantiate the Plaintiff’s bare assertion that she had simply passed on an aggregate sum of HK$143 million to Mr Si and Ms Lim[54]. The complete absence of documentary evidence is hardly explicable, and I do not believe the Plaintiff’s bare assertion.
(8) Contrary to the Plaintiff’s bare assertion, as evidenced by the notes taken by the Plaintiff on her smartphone[55] and the transcripts[56] of the 2 January 2016 Meeting (which involvedSun City’s Mr Chau and Ms Chu, the Plaintiff, and the 2nd Defendant), after taking into account, inter alios, the sum of HK$153 million that had been collected from the 2nd Defendant already and the sum that the Plaintiff and/or Mr Si could retain as agreed to by Mr Chau[57], the Plaintiff had to pay approximately HK$39.1 million to Sun City[58].
(9) In the premises, it is clear that the Plaintiff had to account for the sums that she received from the 2nd Defendant to Sun City. Plainly, the Plaintiff did not receive the aggregate sum of HK$153 million from the 2nd Defendant in her own right. Instead, she simply received the said aggregate sum as an agent on behalf of Sun City, and this was why she had to account for the same.
(10) For completeness, I do not lose sight of the Plaintiff’s suggestion that she was a guarantor in respect of the 2nd Defendant’s indebtedness[59].
(11) However, putting aside the fact that this is not even the Plaintiff’s pleaded case[60], the Plaintiff’s suggestion was not consistent with the way in which the parties conducted the verification/calculation exercise (對數) at the 2 January 2016 Meeting. The parties did not proceed on the basis that (i) Sun City would look to the Plaintiff for the outstanding part of the Gaming Credit Indebtedness or that (ii) should the 2nd Defendant fail to pay the outstanding part of the Gaming Credit Indebtedness, the Plaintiff would be held responsible for the same. Instead, the parties simply broke down the outstanding sum to be received by Sun City into two distinct parts. Whilst the first part was the outstanding sum that the 2nd Defendant should pay Sun City, the second part was the sum that the Plaintiff should account to Sun City (after taking into account the sum that she had already received from the 2nd Defendant and the sum that she was entitled to retain as agreed by Mr Chau[61]). This shows that the Plaintiff was merely allowed to collect payments on Sun City’s behalf, and that when Sun City no longer authorized the Plaintiff to handle the matter on its behalf, the 2nd Defendant would have to make payments to Sun City directly.
(12) For all the above reasons, the mere fact that the 2nd Defendant once paid monies to the Plaintiff (and/or her company, ie Marvella) does not show that the Plaintiff and the 2nd Defendant had entered into contractual dealings on a personal basis or that the alleged 1st and 2nd Credit Agreements existed.
63.Ninth: -
(1) Insofar as the repayment is concerned, Mr Keith Lam contended that the arrangement in relation to the Regalia Bay Property shows that the Plaintiff is the true creditor in respect of the Gaming Credit Indebtedness.
(2) I cannot agree with Mr Lam’s contention, which is contradicted by the Plaintiff’s own contemporaneous message.
(3) In a WeChat group that involved Mr Chau, Mr Si, the 2nd Defendant, the Plaintiff said this:-
“黃總[62]當初答應把別墅[63]過戶給我抵債，我把買別墅的錢幫他還款。”[64] (emphasis added)
(4) Had the Plaintiff’s case been true, what the Plaintiff would have said was that the value or consideration in respect of the Regalia Bay Property should be utilized to set-off the indebtedness owed to her. However, this was not what the Plaintiff said.
(5) It is clear to me that what the Plaintiff meant in the aforesaid WeChat message was that whilst the 2nd Defendant would procure the Regalia Bay Property to be transferred to the Plaintiff, the Plaintiff would, based on the value of the Regalia Bay Property, repay the indebtedness that the 2nd Defendant owed to others. This was why the Plaintiff used the phrase “幫他還款”.
(6) Obviously, the party to whom the indebtedness was owed was Sun City. This is consistent with the calculation/verification exercise that took place at the 2 January 2016 Meeting. As pointed out in paragraph 62 above, the parties proceeded on the basis that the Plaintiff had already collected HK$153 million (not HK$143 million) from the 2nd Defendant. This took into account the HK$10 million, which the 2nd Defendant paid in order to enable the Plaintiff to acquire the Regalia Bay Property.
64.Tenth: -
(1) Mr Keith Lam heftily relied on the following exchange between the Plaintiff and the 2nd Defendant on WeChat in January and February 2015[65]: -
“The Plaintiff: 黃總,額度4000萬澳幣已經做好
The 2nd Defendant: 過年前過去。
The Plaintiff: 好的
The Plaintiff: 珀斯那邊安排好了
The 2nd Defendant: 好謝謝
The Plaintiff: 還款期三個月哦
The 2nd Defendant: 可以的
The Plaintiff: 黃總,額度我們這邊擔保的,需要提醒您,如果逾期不還會產生利息，月息兩分，由您出碼的那天開始計算。
The Plaintiff: 還款要交我給擔保方”
(2) However, as pointed out by Mr Alexander Tang, the WeChat exchange was entirely unclear as to whether the Plaintiff communicated in her personal capacity or in the capacity as a messenger or an agent of Sun City or Crown. I see the force of Mr Tang’s submissions.
(3) Bearing in mind that (i) the job duties of the Plaintiff as Crown’s vice president of marketing included making arrangement for customers to obtain gaming credit[66], (ii) the Plaintiff had a close connection with Sun City and Mr Chau (in that she was actually Mr Si’s cousin and referred to as Mr Chau’s cousin[67]), and (iii) there is evidence showing that the Plaintiff was regarded as the business partner of Mr Si[68] (who was Sun City’s investor and who agreed to release Sun City’s gaming credit to the 2nd Defendant), it appears to me that on the balance of probabilities, it was more likely than not that the Plaintiff communicated with the 2nd Defendant in the capacity as Sun City’s agent or messenger.
(4) In the circumstances, it appears that the phrase “額度我們這邊擔保的” referred to Sun City, which needed to guarantee the indebtedness in respect of the credit viz-a-viz Crown.
(5) Accordingly, even if the 2nd Defendant had accepted the Plaintiff’s proposal regarding overdue interest, it does not follow that the Plaintiff had entered into an agreement with the 2nd Defendant in her personal capacity and that she has the contractual rights to charge overdue interest against the 2nd Defendant.
(6) As mentioned, I am of the view that the contractual dealings were between Sun City and the 2nd Defendant. In this connection, it is worth mentioning that Sun City was eventually content not to charge any overdue interest against the 2nd Defendant, and this was plainly a decision to which Mr Chau (ie Sun City’s sole shareholder/owner) agreed.
(7) I do not lose sight that the Plaintiff’s message also contained a phrase that “還款要交我給擔保方”. However, I agree with Mr Tang that this simply sets out the routing of the repayment, and it does not ipso facto show that the Plaintiff had personally contracted with the 2nd Defendant. In this connection, as canvassed in paragraph 62 hereinabove, from March to August 2015, the Plaintiff did, as Sun City’s agent, receive HK$153 million from the 2nd Defendant. The Plaintiff had to account the sums that she received to Sun City. Be that as it may, Mr Chau eventually decided that Sun City should no longer authorize the Plaintiff to receive repayments on its behalf, and Mr Chau caused the 2nd Defendant to make repayments to Sun City directly. When the entirety of the Gaming Credit Indebtedness was repaid, Sun City issued the Deed of Release dated 17 September 2019 to confirm that the 2nd Defendant was discharged of all liabilities.
(8) In the premises, on proper analysis, the WeChat exchange between the Plaintiff and the 2nd Defendant in January and February 2015 does not prove that the Plaintiff had contracted with the 2nd Defendant on a personal basis.
65.Eleventh: -
(1) Mr Keith Lam also reminded me that the contemporaneous exchange records[69] show that there were discussions that 1/3 of the junket commission be shared with the 2nd Defendant.
(2) I am not of the view that this would avail the Plaintiff’s case.
(3) Even if the Plaintiff, Mr Si, the 2nd Defendant had liaised with each other with regard to the rebate in respect of the junket commission, this was a separate matter, and it does not follow that the creditor-debtor relationship regarding the Gaming Credit Indebtedness was not between the 2nd Defendant and Sun City or that the 2nd Defendant had agreed to pay overdue interest to the Plaintiff pursuant to the alleged 1st and 2nd Credit Agreements.
66.Twelfth: -
(1) I do take into account that the 2nd Defendant did not testify in court.
(2) In this regard, what happened was as follows: -
(a) The 2nd Defendant made a witness statement and a supplemental witness statement.
(b) On 26 May 2026, the Defendants belatedly took out a summons seeking leave for the 2nd Defendant to testify at trial by way of video conferencing facilities (the “VCF Application”).
(c) In gist, the 2nd Defendant said that he was in France, and due to chest pain, he had been advised not to take flights that exceed 3 hours.
(d) On the first day of trial, I dealt with the VCF Application: -
(i) Applying the legal principles propounded by Anthony Chan J (as Anthony Chan JA then was) in Re Nobility School Ltd [2020] HKCFI 891 at para 9, the starting point was that legal proceedings should be conducted in court, and the VCF Application must be justified with a sound reason.
(ii) I was unable to satisfy myself that the VCF Application was justifiable. In my view, the medical evidence relied on by the Defendants, which was a one-page medical certificate, was wholly unreliable. The alleged medical condition suffered by the 2nd Defendant was not identified. There was no diagnosis; nor was there any medical analysis. The French doctor, who signed the medical certificate, did not even state his professional qualification.
(e) In the premises, I had no alternative but to dismiss the VCF Application. As such, the 2nd Defendant did not testify in the present trial.
(3) Accordingly, I place minimal weight on the assertions in the 2nd Defendant’s witness statement and supplemental witness statement.
(4) However, the fact that I place minimal weight on the contents of the 2nd Defendant’s witness statement and supplemental witness statement is not a reason for suggesting that I am bound to accept the Plaintiff’s case.
(5) Despite the absence of the 2nd Defendant, I still prefer the Defendants’ case to the Plaintiff’s case.
(6) Having considered the Plaintiff’s answers given during cross-examination, I am not of the view that she was a credible witness; nor am I of the view that she has discharged the onus of showing that the alleged 1s and 2nd Credit Agreements existed or that the 2nd Defendant had agreed to pay her overdue interest.
(7) More importantly, for the reasons elaborated hereinabove, I am of the view that the Plaintiff’s case is, in multiple material respects, flatly contradicted by, and inconsistent with, the inherent probabilities, the apparent logic of events, the objective circumstances, commercial common sense, and the contemporaneous communication records and messages. Meanwhile, the Defendants’ case is, by and large, consistent with the contemporaneous documents, commercial common sense, the objective circumstances, and the inherent probabilities.
(8) For completeness, I am not of the view that it would be appropriate to draw an adverse inference against the Defendants. In light of the way in which the matters in these proceedings developed, I am not of the view that the 2nd Defendant sought to hide unfavourable facts. After all, he did seek to testify in court from France by way of video conferencing facilities, though I disagreed that he was entitled to do so[70].
67.For all the above reasons, I reject the Plaintiff’s primary case that she had personally entered into the alleged 1st and 2nd Credit Agreements with the 2nd Defendant and that she is entitled to claim overdue interest on the Gaming Credit Indebtedness against the 2nd Defendant.
68.I find that: -
(1) By reason of her job duties as Crown’s vice president of marketing, the Plaintiff simply, as a middleman, made arrangements for the 2nd Defendant to obtain gaming credit of AUD 60 million from Sun City. Mr Si, who was an investor of Sun City, was the one who agreed that the said gaming credit of Sun City be released to the 2nd Defendant.
(2) The alleged 1st and 2nd Credit Agreements did not exist. The Plaintiff and the 2nd Defendant (i) had not entered into any contractual dealing on a personal basis in relation to the Gaming Credit Indebtedness, and (ii) had not agreed that the Plaintiff is entitled to charge overdue interest on the Gaming Credit Indebtedness.
(3) The creditor-debtor relationship in regard to the Gaming Credit Indebtedness was between Sun City and the 2nd Defendant, not between the Plaintiff and the 2nd Defendant.
(4) Crown, Sun City, and Mr Si all agreed that no overdue interest would be charged in regard to the indebtedness arising from the gaming credit that was offered to the 2nd Defendant.
(5) Whilst the Plaintiff received an aggregate sum of HK$153 million from the 2nd Defendant from 25 March 2015 to 10 August 2015, she did so in the capacity as Sun City’s agent, and she had to account for the same to Sun City, though she was entitled to exercise certain rights of set-off viz-a-viz Sun City (which had nothing to do with the 2nd Defendant)[71].
(6) The Plaintiff did not pass on HK$143 million to Mr Si and Ms Lim.
(7) Mr Chau and/or Sun City did not seek to hold Mr Si and/or Ms Lim responsible for the Gaming Credit Indebtedness, and Mr Si and/or Ms Lim were not keen on recovering the Gaming Credit Indebtedness (as well as the alleged overdue interest accrued thereon) from the 2nd Defendant.
(8) From November 2015 onwards, Mr Chau and/or Sun City had liaised with the 2nd Defendant for repaying the Gaming Credit Indebtedness.
(9) To this end, the 2 January 2016 Meeting took place. Whilst the Plaintiff attended the same, she did not assert that the alleged 1st and 2nd Credit Agreements existed; nor did she request the 2nd Defendant to pay her overdue interest.
(10) On 15 and 26 February 2019, the Plaintiff, relying on the 3 Cheques, liaised with the 1st Defendant for repayment. She only complained that the 2nd Defendant failed to pay her the sum of HK$5 million relating to the Regalia Bay Property. She did not assert that the alleged 1st and 2nd Credit Agreements existed. She did not assert that the 2nd Defendant was liable to pay her overdue interest on the Gaming Credit Indebtedness. She also did not assert that the 3 Cheques were security over the Gaming Credit Indebtedness, which was allegedly owed to her.
(11) Likewise, although the Plaintiff issued a WeChat message to the 2nd Defendant on 14 February 2019 mentioning about (i) the aforesaid sum of HK$5 million relating to the Regalia Bay Property and (ii) the fact that the 1st Cheque had been dishonoured, she did not assert that the 2nd Defendant was liable to pay overdue interest on the Gaming Credit Indebtedness pursuant to the alleged 1st and 2nd Credit Agreements. She also did not assert that the 3 Cheques were security over the Gaming Credit Indebtedness, which was allegedly owed to her.
(12) Meanwhile, the 2nd Defendant had kept making repayments to Sun City directly. As of 17 September 2019, the entirety of the Gaming Credit Indebtedness owed to Sun City had been repaid. Thus, Sun City executed and issued the Deed of Release to confirm that the 2nd Defendant had been discharged of all liabilities.
E2. Did the Plaintiff, as agent of Mr Si and Ms Lim, enter into 1st and 2nd Credit Agreements with the 2nd Defendant?
69.I now address the Plaintiff’s alternative case that she, as agent, entered into the alleged 1st and 2nd Credit Agreements on behalf of Mr Si and Ms Lim (who were undisclosed principals).
E2(a) There is no Reasonable Justification for running a Factually Inconsistent Alternative Case
70.Mr Alexander Tang raised a preliminary objection. He pointed out that the Plaintiff sought to run a factually inconsistent case regarding intention.
71.For the following reasons, I accept Mr Tang’s submissions.
72.In Kaefer Aislamientos SA de CV v AMS Drilling Mexico SA de CV [2019] 1 WLR 3514 at para 55, Green LJ pointed out that in order to show that a party is an undisclosed principal, one of the requirements that must be satisfied is that:-
“at the time of the relevant contract, the agent intended to contract on the principal’s behalf” (emphasis added)
73.In the premises, it is not open to the Plaintiff to contend that whilst she “intended” to contract with the 2nd Defendant in her personal capacity, she simultaneously “intended” to contract with the 2nd Defendant on behalf of Mr Si and Ms Lim. The 2 scenarios were factually inconsistent with each other and could not co-exist.
74.Under Order 18, rule 12A:-
“A party may in any pleading make an allegation of fact which is inconsistent with another allegation of fact in the same pleading if- (a) the party has reasonable grounds for doing so; and (b) the allegations are made in the alternative” (emphasis added)
75.As pointed out by the learned authors of Hong Kong Civil Procedure (2026) at para 18/12A/1: -
“As a prerequisite to [pleading inconsistent allegation of fact], there must first of all exist reasonable grounds, and the inconsistent allegations must be pleaded as alternatives. One of the objectives of this rule is to prevent a party from pleading inconsistent cases in relation to a matter which is plainly within his knowledge, so that there could be no justification for him to put forward inconsistent factual alternatives; with the requirement to verify the pleadings, a party simply cannot properly so verify; Hui Yin Sang v Tsoi Ping Kwan [2010] 1 HKC 585, 595B-E [25(10)]. Emphasis is placed on such matter which is plainly within one’s knowledge (Ivy Xhu Xu v Hong Kong Petrochemical Co Ltd [2023] 6 HKC 221…)” (emphasis added)
76.In my view, the scenario in the present case falls squarely within the aforesaid proposition: -
(1) Mr Keith Lam emphasized that the court will have to ascertain contractual intention objectively based on the parties’ words and conduct. I accept that this is generally the correct approach. However, it does not mean that it is open to a party to put forward two inconsistent versions of facts as to her own contractual intention.
(2) There are scenarios where a party is not privy to the factual matters in question, such that he or she will have to rely on the interpretation of the objective facts from which inferences are drawn. However, this is not the scenario in the present case. The present case does not involve a scenario where a party is not privy to the relevant factual matter in question, and hence does not have direct knowledge thereof.
(3) The Plaintiff, who allegedly contracted with the 2nd Defendant, must know whether she “intended” to contract with the 2nd Defendant in her own capacity or whether she “intended” to contract with the 2nd Defendant on behalf of Mr Si and Ms Lim as an agent. The Plaintiff’s contractual intention must be a matter that was within her own knowledge.
(4) In this connection, it is pertinent to refer to Bowstead & Reynolds on Agency (23rd Ed) at para 8-072. There, the learned authors stated:-
“In accordance with general principle, the burden of proving that there is an undisclosed principal lies on the party asserting it. Although the intention of one party not communicated to the other is not usually relevant to the legal effect of a transaction, it is plain that if the agent has, as is required for the doctrine to operate, actual authority, the agent’s subjective intention will frequently be relevant to the question whether in this particular situation the agent has acted for the principal, or for some other principal, or personally.”
(5) More importantly, in Lai Wo Heung v Cheung Kong Fur Fty Co Ltd [2004] 1 HKLRD 959 at paras 10 to 11, A Cheung J (as Cheung CJ then was) held that it is the “subjective intention” of the agent and the principal that matters. His Lordship stated:-
“10. The question of whose agent Mr Tuen Mo was at the time of the interview and making the contract of employment must be a question of fact, depending directly on the intention of Mr Tuen Mo as agent and the intention of the intended principal. However, since Mr Tuen Mo was also the effective controlling minds of both the defendant and Cheung Hing respectively, the question of whose agent he was must ultimately depend on the intention of Mr Tuen Mo at the time. By intention, I am referring to the subjective intention of Tuen Mo, as opposed to any objective intention that may be gathered from the surrounding circumstances. I will come back to the relevance of objective appearances in a moment’s time. However, given that agency in the present sense is a question of fact, which must turn on the intentions of the agent as well as his true principal, the focus of investigation must be the subjective intentions of the agent as well as the principal, rather than any so-called “objective” intentions of the two.
11. That this should be the position is by no means surprising: in the case of an undisclosed principal simpliciter (see below) — which this case is not, the third party contracting with the supposed principal may well have had all the reasons on earth to believe that his contracting party was acting as a principal; but if the supposed principal can establish by evidence to the satisfaction of the court, based on the applicable burden and standard of proof, that he did not intend to enter into the subject contract as principal but instead intended to enter into the contract as the agent of somebody — although none of this was made known to the third party with whom he was entering into the contract, the law would, subject to any contrary provisions in the contract, give effect to the subjective (albeit secret and uncommunicated) intention of the agent by recognising the undisclosed principal as indeed a contracting party to the subject contract with the third party. In that situation, the law would at the same time impose on the agent personal liability under the contract in question (unlike the case of an agent acting for a disclosed principal).
12. A fortiori, the case of an unnamed principal - which is indeed the present case1: the fact that the agent was acting not for himself but for a principal was known to the third party contracting with the agent; however, the principal was unnamed. In that situation, who actually was the contracting party with the third party under the subject contract would ultimately depend on what actually was the intention of the agent (as well as the intention of the unnamed principal for whom the agent was acting). Subject to what I will shortly discuss, there is no place in the above discussion for the introduction of an objective evaluation of the circumstances, in particular, an objective assessment as to whether the agent was, to the outside world (viewed objectively), acting as a principal himself (i.e. the case of an undisclosed principal simpliciter), or acting as an agent for somebody other than the person actually intended by the agent subjectively to be the principal for whom he was acting.
……
14. What is the relevance, if any, of the objective appearances? Objective appearances are relevant in several ways in the above analysis. Without seeking to be exhaustive, first, the objective appearances - including the pre-contractual as well as post-contractual words and conduct of the parties and the surrounding circumstances - are relevant in assessing the credibility of the witnesses (particularly the agent and the supposed principal) regarding their assertions of what their intentions were at the time. Very often, the best guide to what actually was in the mind of a person is what he said or did contemporaneously.
……
18. Bearing the above principles and analyses in mind, I have no doubt that quite unfortunately, in the present case, the Labour Tribunal has failed to focus its mind on the crucial issue: what was the subjective intention of Mr Tuen Mo - his subjective intention, on the facts of the present case, represented not only his own intention as an agent, but also the intention of the intended principal for whom he was acting in entering into the contract of employment with the Claimant. I say this for a number of reasons: first, not only were the above analyses, or something similar to the above analyses, not mentioned in the oral reasons or the written reasons for decision, the crucial issue itself, i.e. what was the intention of Mr Tuen Mo, was also never set out or discussed in the oral or written reasons.
(Emphasis added)
(6) However, Mr Keith Lam referred me to Magellan Spirit ApS v Vitol SA (Magellan Spirit) [2016] 1 CLC 480 at paras 17 to 18. There, Leggatt J (as he then was), referring to Keighley Maxsted & Co v Durant [1901] AC 240, 256 and Garnac Grain Co Inc v HMF Faure & Fairclough Ltd [1968] AC 1130 at 1137, stated:-
“I do not accept, however, that Mr Fransen’s subject state of mind is relevant for this purpose, let alone decisive. It is one thing to infringe the objective principle- as the doctrine of undisclosed principle undoubtedly does- by allowing the existence of contractual rights and obligations to depend on an intention which is not communicated to the other contracting party. But it would go a step further, and would give rise to wholly unacceptable uncertainty…
The question whether an undisclosed agency relationship was created must depend in principle, as I see it, not on the state of mind of the supposed agent at the time of contracting, but on whether the supposed agent had communicated to the supposed principal an intention to contract on its behalf.”
(emphasis added)
(7) Recognizing the tension between the two conflicting lines of authorities, the learned authors of Bowstead & Reynolds on Agency (23rd Ed) at para 8-072 had this to say:-
“There are recent dicta doubting this position and suggesting that objective evidence is always required. It might be accepted that objective evidence of the existence of an undisclosed principal might be necessary, but it ought not to be necessary that in addition there be objective evidence, contemporary or otherwise, that there has been an exercise of the authority…If it were necessary in such cases that there be objective evidence of the party for whom the agent was acting in the particular transaction, it would follow that in the absence of such evidence there would be no contract at all. Naturally, where objective evidence is available (such as communications between principal and agent, business records, evidence of past practice) it is likely to be preferred over contradictory personal testimony from the agent at trial. In the last resort, however, the question will turn on whether the trier of fact believes that agent when the agent asserts that in this particular instance he or she was acting for the principal or personally or for a different principal.” (emphasis added)
(8) Despite Mr Lam’s able submissions, I refuse to depart from Lai Wo Heung. In my view, the analysis of A Cheung J (as he then was) was sound. In a typical scenario involving an assertion of undisclosed principal, the third party would not even know about the existence of the supposed principal. As such, there are no objective circumstances that may be gathered from the surrounding circumstances. In these premises, I do understand why the learned Judge emphasized that in considering whether a supposed agent acted for a particular undisclosed principal, the focus of the enquiry was the state of mind or subjective intention of the supposed agent (as well as the supposed principal). However, it does not mean that the supposed agent is at liberty to allege whatever he or she wants, such that there will be uncertainty. As pointed out by the learned authors of Bowstead & Reynolds on Agency (23rd Ed) at para 8-072 and the learned Judge (see Lai Wo Heung at para 14), the court will still have to consider the objective evidence (such as the communications between the supposed agent and supposed principal, business records, and past practice). After all, this is a fact-finding exercise.
(9) Put simply, I am of the view that:-
(a) In considering whether a supposed agent “intended” to contract on behalf of a supposed undisclosed principal (see Kaefer Aislamientos SA de CV at para 55), the focus of the enquiry was the supposed agent’s “subjective intention” (see Lai Wo Heung at para 11).
(b)However, in the course of ascertaining the “subjective intention” of the supposed agent, instead of confining itself to the self-serving assertions made by the supposed agent, the court will consider the “objective evidence” surrounding the transaction(s) in question.
(10) In the premises, I cannot see how the Plaintiff might put forward two inconsistent versions of events as to her own contractual intention. The fact that the court will consider the objective evidence surrounding the factual circumstances is not a reason for the Plaintiff to put forward two inconsistent versions as to her own subjective contractual intention.
(11) I cannot see how it can be said that the Plaintiff “has reasonable grounds” to plead inconsistent facts; nor can I see how the Plaintiff can verify both versions of factual events under a statement of truth.
77.For the above reasons, I am of the view that the Plaintiff has flouted Order 18, rule 12A. She has no reasonable justification for pleading inconsistent versions of facts as to her own contractual intention.
E2(b) The Plaintiff’s Alternative Case is not Credible Anyhow
78.In any event, for the following reasons, I am of the view that the Plaintiff’s alternative case based on agency is wholly incredible, and I reject the Plaintiff’s suggestion that Mr Si and Ms Lim were principals.
79.First of all, insofar as the involvement of Mr Si is concerned:-
(1) As pointed out, Mr Si (who was an alleged principal according to the Plaintiff’s alternative case) was not keen on recovering the Gaming Credit Indebtedness, not to mention the alleged overdue interest.
(2) As Mr Keith Lam and Mr Cedric Yeung accepted in their opening submissions[72], Mr Si was only interested in his share of the junket commission or share in the profits. This indication is consistent with and corroborated by the contemporaneous exchange involving Mr Si.
(3) When the Plaintiff issued a WeChat message to Mr Si on 25 September 2017 stating “錢不是給皇冠的。給男哥[73]的。我沒有收過他給皇冠的任何錢” (emphasis added), Mr Si was puzzled, and he responded with 3 puzzling emojis ( )[74]. This incident appears to show that Mr Si did not take the view that he was entitled to receive any money from the 2nd Defendant. As such, Mr Si could not be a party to the 1st and 2nd Credit Agreements.
(4) More importantly, during the period from July to December 2019, the 2nd Defendant had multiple telephone conversations with Mr Si (which were recorded). Mr Si obviously disagreed that the Plaintiff was in a position to sue the 2nd Defendant: -
(a) During the telephone conversations on 26 July 2019, Mr Si said: -
“這個都不用律師，我當時就跟她[75]講了… 你沒有借錢給他，你憑什麼告他？” [76]
“我想知道到底澳洲的錢是還完了沒？… 我到後面我是沒有參與的。” [77]
(b) During the telephone conversations on 30 July 2019, Mr Si said: -
“又不是拖我的…我說我也賺到錢，你也而且她也說她比我大份嘛，所以一人一半，後來也沒給我啊，我也不吭声了，因為後來不是這個賬不用我去跟嘛…” [78]
(5) The aforesaid telephone conversations show that Mr Si believed that the Plaintiff did not have the standing to sue the 2nd Defendant at all, and he did tell the Plaintiff that this was the case. It appears that Mr Si would not have said this had the Plaintiff entered into the 1st and 2nd Credit Agreements on his behalf as his agent.
(6) The aforesaid telephone conversations also show that Mr Si did not know whether the 2nd Defendant had fully repaid the Gaming Credit Indebtedness (ie the money lost at the Casino (澳洲的錢)). Obviously, Mr Si did not consider that he had an interest in relation to the repayment of the Gaming Credit Indebtedness. This was why he was not involved in the matter, and he had no knowledge about the subsequent development.
(7) Further, the aforesaid telephone conversations corroborate the suggestion that Mr Si was only interested in the junket commission or sharing of profit (我說我也賺到錢). More importantly, Mr Si stressed that no outstanding indebtedness was owed to him (又不是拖我的). Obviously, Mr Si would not have said this had he been a party to the alleged 1st and 2nd Credit Agreements and hence entitled to receive overdue interest, which had been outstanding.
(8) In light of Mr Si’s stance in the contemporaneous exchange, I reject the suggestion that the Plaintiff entered into the alleged 1st and 2nd Credit Agreements on behalf of Mr Si. For the reasons canvassed, above, it appears to me that: -
(a) Mr Si disagreed that the Plaintiff could sue the 2nd Defendant.
(b) Mr Si disagreed that the 2nd Defendant owed him any money.
(c) Mr Si did not even consider that he had an interest in the repayment of the Gaming Credit Indebtedness.
(d) Mr Si took the view that his interests in the transactions regarding the gaming credit were the junket commission.
(9) In the premises, there was no surprise that Mr Si was not keen on participating in these proceedings at all. Mr Si had not made any witness statement or affirmation on the Plaintiff’s behalf; nor had he testified. This was consistent with the stance that Mr Si indicated in the aforesaid WeChat messages.
(10) When the Plaintiff was cross-examined on this topic[79], she indicated that in light of Mr Chau’s imprisonment in Macao, Mr Si had every reason to be cautious, and he would not wish to participate in these proceedings. I do not accept the Plaintiff’s explanation. Whilst there is no evidence showing that the matters in these proceedings were related to the activities that led to Mr Chau’s imprisonment, there is also no suggestion that the activities of the parties involved any illegality.
(11) The Plaintiff also suggested that due to Mr Chau’s intervention, Mr Si felt embarrassed and hence did not wish to be involved[80]. I do not accept this explanation, which was wholly unconvincing. If Mr Si had an economic interest in the matter, he had every reason to be involved in the subsequent development. The participation of Mr Chau was not a reason why Mr Si would feel embarrassed. There was nothing embarrassing at all.
(12) In my view, the reality was simply that Mr Si does not consider that he has any interests in the claims pursued by the Plaintiff, and, as such, he does not wish to be involved.
80.Second: -
(1) As the Plaintiff admitted when she gave oral evidence[81], Mr Si’s role and involvement had always been “disclosed” to the 2nd Defendant(“男哥從來都披露的”).
(2) In light of this admission, I cannot see how the Plaintiff’s legal representative may run a case based on “undisclosed” principal. Even if Mr Si were a principal, he is a “disclosed” principal. Since Mr Si is unwilling to sue the 2nd Defendant at all, there is no room for the Plaintiff to purportedly bring a claim on his behalf.
(3) As pointed out by the learned authors of Bowstead & Reynolds on Agency (23rd Ed) at paras 9-001 and 9-002:-
“… when an agent makes a contract, purporting to act solely on behalf of a disclosed principal, whether identified or unidentified, the agent is not liable to the third party on it. Nor can the agent sue the third party on it” (emphasis added)
“…where a person contracts as agent for a principal, the contract is the contract of the principal and not that of the agent; and, prima facie, at common law the only person who may sue is the principal and the only person who can be sued is the principal.”
(4) It is noteworthy that the Plaintiff only has 1 alternative case, ie Mr Si and Ms Lim were joint undisclosed principals[82]. In light of the Plaintiff’s admission, her alternative case collapses in its entirety.
81.Third, Ms Lim’s interests and involvement were completely obscured. I am not persuaded that she was a principal as alleged:-
(1) There is not a shred of contemporaneous evidence showing that Ms Lim was interested in recovering the Gaming Credit Indebtedness, not to mention that alleged overdue interest accrued thereon.
(2) Further, had the Plaintiff acted as Ms Lim’s agent, the Plaintiff would have passed on part of the sum of HK$143 million received from the 2nd Defendant to Ms Lim. In her witness statement, Ms Lim did not even seek to corroborate the Plaintiff’s assertion that the sum of HK$143 million had been passed on to herself and Mr Si.
(3) However, when Ms Lim gave oral evidence[83], she suggested that the Plaintiff had paid or forwarded part of the sum of HK$143 million to herself and that some set-off exercises were conducted between herself and the Plaintiff. I do not accept Ms Lim’s evidence. Bearing in mind that sizeable sums were involved, it is inherently unlikely that the payments from the Plaintiff and/or the alleged set-off exercise[84] were not evidenced by a shred of contemporaneous documents or records. Indeed, Madame Lim’s allegations that she asked the Plaintiff to (i) buy jewellery for herself, (i) invest the sums in family businesses, and (iii) invest the sums in properties were vague, unparticularized, and not supported by documents. I do not accept these bare assertions.
(4) More importantly, according to what Mr Si said to the 2nd Defendant during a telephone conversation that took place on 9 December 2019 (which was recorded)[85], Mr Si did not know about Ms Lim’s involvement at all, and he was entirely puzzled as to the suggestion that Ms Lim was a “guarantor”.
(5) I do understand why Mr Si felt puzzled and why he disagreed with the suggestion that Ms Lim was involved. There is not a shred of documentary evidence and/or contemporaneous message showing that Ms Lim was treated as a party to the transactions relating to the gaming credit. In fact, no part of the Gaming Credit Indebtedness was booked under Ms Lim’s line of credit in the internal account maintained with Sun City, ie account “BV1”[86]. Instead, as evidenced by the 8 August 2019 Letter[87], the entirety of the Gaming Credit Indebtedness owed by the 2nd Defendant was booked under Sun City’s internal account “BB2”, which represented Mr Si’s line of credit[88].
82.Fourth: -
(1) I repeat the analysis of the factual circumstances set out in paragraph 59 above.
(2) Had the Plaintiff contracted with the 2nd Defendant on behalf of Mr Si and Ms Lim as an agent, when the Plaintiff liaised with the 1st and 2nd Defendants based on the 3 Cheques back in February 2019, the Plaintiff, being Mr Si and Ms Lim’s agent, would have mentioned that: -
(a) The 3 Cheques were given for the purpose of securing the Gaming Credit Indebtedness, which was owed to Mr Si and Ms Lim (whom she allegedly represented).
(b) Although the 2nd Defendant had fully repaid the principal sum in respect of the Gaming Credit Indebtedness, he had not repaid the overdue interest.
(c) Accordingly, the 2nd Defendant was indebted to Mr Si and Ms Lim (who were allegedly represented by her), and, as such, she was entitled to present the 1st Cheque for repayment.
(3) However, the Plaintiff mentioned none of these matters. Instead, she focused on the HK$5 million difference (or bonus) in relation to the acquisition of the Regalia Bay Property, and she even emphasized to the 1st Defendant that what she pursued had nothing to do with the Gaming Credit indebtedness (我現在不跟他對皇冠和太陽城的帳).
(4) Similarly, in the Plaintiff’s WeChat message to the 2nd Defendant on 14 February 2019, she merely focused on the aforesaid sum of HK$5 million relating to the Regalia Bay Property. She did not assert that the 2nd Defendant is liable to pay overdue interest to Mr Si and/or Ms Lim pursuant to the 1st and 2nd Credit Agreements.
(5) For the reasons already canvassed, I am of the view that the Plaintiff’s claim is an afterthought and hence incredible.
83.Fifth: -
(1) I repeat the analysis of the factual circumstances set out in paragraph 60 above.
(2) Had the Plaintiff contracted with the 2nd Defendant on behalf of Mr Si and Ms Lim, at the 2 January 2016 Meeting, the Plaintiff would have sought to work out and/or calculate the amount of overdue interest on the Gaming Credit Indebtedness, which the 2nd Defendant was liable to pay Mr Si and Ms Lim (who were allegedly represented by the Plaintiff herself).
(3) However, the Plaintiff did not do so. In my view, there was no credible reason why the Plaintiff did not seek to deal with this matter when the parties attempted to sort out and/or clarify their financial positions viz-a-viz each other.
(4) For the reasons already canvassed, I am of the view that the most probable explanation was that as of January 2016, the Plaintiff had not yet come up with the ideas that the 1st and 2nd Credit Agreements exist and that the 2nd Defendant should pay overdue interest on the Gaming Credit Indebtedness.
84.Sixth: -
(1) I repeat the analysis of the factual circumstances and the contemporaneous messages set out in paragraphs 57, 61, and 62 above.
(2) The objective circumstances show that the contractual dealings in relation to the Gaming Credit Indebtedness were between Sun City and the 2nd Defendant (not the Plaintiff nor Mr Si/Ms Lim). This was why: -
(a) As Mr Chau was, at one stage, content that the Plaintiff could collect the repayments in regard to the Gaming Credit Indebtedness, the Plaintiff had collected HK$153 million from the 2nd Defendant prior to August 2015. As a collecting agent, the Plaintiff had to account for the repayments collected from the 2nd Defendant to Sun City.
(b) However, from November 2015 onwards, Mr Chau had decided that he should liaise with the 2nd Defendant directly and that the 2nd Defendant should make repayments to Sun City directly. Against this background, the 2 January 2016 Meeting took place. There, the parties sorted out and calculated the amounts of monies that they should pay each other.
(c) Throughout the process, Mr Chau and/or Sun City did not “look to” Mr Si and/or Ms Lim for repayments. Indeed, Mr Si and/or Ms Lim were not keen on ensuring that the 2nd Defendant would make repayments.
(d) As of September 2019, the 2nd Defendant had fully repaid the entirety of the Gaming Credit Indebtedness to Sun City. As such, Sun City executed and issued the Deed of Release dated 17 September 2019[89] to confirm that the 2nd Defendant had been discharged of all liabilities.
(3) In my view, had the Plaintiff’s alternative case been true: -
(a) Mr Chau and/or Sun City would have looked to Mr Si and Ms Lim for repayments (which did not happen);
(b) Mr Si and/or Ms Lim would have been keen on ensuring that the 2nd Defendant would repay the Gaming Credit Indebtedness as well as the interest accrued thereon (which did not happen);
(c) Sun City would not have executed and issued the Deed of Release in favour of the 2nd Defendant.
85.Seventh:-
(1) Mr Keith Lam also contended that Sun City could not be a party to the 1st and 2nd Credit Agreements because under Sun City’s internal share certificate agreement[90], the investors (ie Mr Si and Ms Lim) were the ones who had a credit relationship with the patron (ie the 2nd Defendant).
(2) I disagree with Mr Lam’s submissions.
(3) On the evidence before the court, it does not appear that the parties conducted themselves in accordance with the structure under Sun City’s internal share certificate agreement. Whilst Sun City did not look to Mr Si and/or Ms Lim for repayment, Mr Si and/or Ms Lim were not keen on recovering the Gaming Credit Indebtedness, and they were not even involved in the calculation/verification exercise (對數) at the 2 January 2016 Meeting at all. Furthermore, there is no evidence showing that any part of the aggregate sum of HK$143 million, which the Plaintiff collected from the 2nd Defendant, had been passed on to Mr Si and/or Ms Lim at all.
(4) Indeed, when Ms Lim (who testified for the Plaintiff) was cross-examined, she accepted that the transactions relating to the gaming credit granted to the 2nd Defendant had nothing to do with Sun City’s internal share certificate agreement[91].
86.Eighth, for the reasons elaborated in paragraph 64 above, the fact that the 2nd Defendant was absent from the present trial is not a reason for this court to accept the Plaintiff’s assertions, which are, in multiple material respects, contradicted by, and inconsistent with, the inherent probabilities, the objective circumstances, and the contemporaneous communication records. Despite the 2nd Defendant’s absence, I prefer the Defendants’ case to the Plaintiff’s case.
87.For all the above reasons, I reject the Plaintiff’s alternative case that she entered into the 1st and 2nd Credit Agreements on behalf of Mr Si and Ms Lim as an agent.
88.I further find that: -
(1) The 1st and 2nd Credit Agreements did not exist at all.
(2) The Plaintiff had not, as agent of Mr Si and/or Ms Lim, entered into any contractual dealing with the 2nd Defendant in relation to the Gaming Credit Indebtedness.
E3. The Defendants’ Alternative Case based on Estoppel and/or Waiver
89.In light of my findings and conclusion set out in sections E1 and E2 above, the Defendants’ alternative case based on estoppel does not arise, and is academic.
90.However, for completeness, I shall set out my views.
91.In his submissions, Mr Alexander Tang focused on the application of the doctrine of estoppel by standing by.
92.In Mo Ying v Brillex Development Ltd & Anor [2015] 2 HKLRD 985 at para 8.2, Cheung JA summarized the doctrine of estoppel by standing by (or estoppel by silence, inaction or acquiescence) as follows: -
“1) An estoppel by silence, inaction or acquiescence arises where ‘a reasonable man would expect the person against whom the estoppel is raised, acting honestly and responsibly, to bring the true facts to the attention of the other party known to him to be under a mistake as to their respective rights and obligations’ and this has been approved as the general principle underlying estoppel by acquiescence’: see Spencer Bower on the Law Relating to Estoppel by Representation (4th Ed) paragraph III.4.3, at page 48, citing Moorgate Mercantile Co Ltd v Twitchings [1977] AC 890, 903F (per Lord Wilberforce). See also Lee Bing Cheung v Secretary for Justice (HCA 1092/2010, 21/2/2013) paragraphs 40-45 (DHCJ Marlene Ng).
2) A duty to speak, such as to found an estoppel on silence will arise in circumstances:
‘(1) [w]here a person, having a title or right to property of any kind, perceives that another person is innocently, and ignorant, conducting himself with reference to the property in a manner inconsistent with such right or rights: see Spencer Bower paragraph III.4.4(1);
(2) [w]here an owner becomes aware that someone is attempting to dispose of his property’, and in such circumstances ‘he is bound to assert his rights and, if he fails to do so, he may be estopped against the disponee’. ‘His silence may be a representation either that he has no title or that the person dealing with the property has his authority: see Handley on Estoppel by Conduct and Election paragraph 3-012; or
(3) [w]hen anything in order to a purchase is publicly transacted, and a third person, knowing thereof, and of his own right to the lands intended to be purchased, does not give the purchaser notice of that right, he shall never afterwards be admitted to set up such rights to avoid the purchase; for it was an apparent fraud in him not to give notice of his title to the intended purchaser, and in such cases infancy…shall be no excuse. :see Savage v Foster (1723) 9 Mod Rep 35, 37 (see also Spiro v Lintern [1973] 1 WLR 1002, 1010F-1011D)’.”
93.In CS Credit Ltd v Marspan Ltd [2021] HKCFI 3707 at para 75, Recorder Eva Sit SC stated: -
“… the principles applicable to estoppel by silence, inaction or acquiescence is as follows: -
(1) This estoppel arises where a reasonable man would expect the person against whom the estoppel is raised, acting honestly and responsibly, to bring the true facts to the attention of the other party known to him to be under a mistake as to their respective rights and obligations.
(2) The essential elements to found the estoppel are: -
(a) a representation or conduct amounting to representation intended to induce a course of conduct on the part of the person to whom this is made, which can take the form of silence of inaction where there exists a duty to speak;
(b) an act or omission resulting from the representation by the person to whom the representation is made; and
(c) detriment to such person as a consequence of the act or omission.
(3) A duty to speak in (2)(a) above will arise: -
(a) where a person, having a title or right to property of any kind, perceives that another person is innocently, and ignorantly, conducting himself with reference to the property in a manner inconsistent with such right or rights;
(b) where the owner becomes aware that someone is attempting to dispose of his property, and in such circumstances he is bound to assert his rights and, if he fails to do so, he may be estopped against the disponee; or
(c) when anything in order to a purchase is publicly transacted, and third person, knowing thereof, and of his own right to the lands intended to be purchased, doth not give the purchaser notice of such right, he shall never afterwards be admitted to set up such right to avoid the purchase: §8.2.
(4) Since knowledge or awareness is vital, the knowledge required is actual or Nelsonian knowledge; in other words, the beneficiary must know or should have known the true position.
(5) Such knowledge must have arisen as at the date of the transaction disposing of the property.”
94.In their re-re-amended defence and counterclaim, the Defendants only expressly pleaded estoppel by representation (based on the Plaintiff’s conduct). However, for the following reasons, I am not of the view that the Defendants are barred from relying on doctrine of estoppel by standing by (or estoppel by silence, inaction or acquiescence): -
(1) It is trite that a party is only required to plead the material facts, and he is at liberty to present in argument any legal consequence of which the facts permit: see Hong Kong Hua Qiao Co Ltd v Cham Ka Tai [2015] 4 HKC 167 at para 20 (per Kwan JA, as Kwan VP then was); and In re Vandervell’s Trust (No 2) [1974] 1 Ch 269 at 321H -322A.
(2) In their re-re-amended defence & counterclaim, the Defendants did plead that:
(a) At the 2 January 2016 Meeting, Mr Chau and Ms Chu of Sun City, the Plaintiff, and the 2nd Defendant agreed, inter alia, (i) the 2nd Defendant would directly pay to Sun City HK$125,900,000 and (ii) the Plaintiff would directly pay to Sun City or Crown, inter alia, HK$39,100,000[92].
(b) By, inter alia, (i) “knowingly” allowing Sun City to directly negotiate and deal with the 2nd Defendant on the repayment of the Gaming Credit Indebtedness since November 2015 and (ii) not pursuing any payment of interest against the 2nd Defendant (until the amendment of the writ in the present action on 13 December 2019), the Plaintiff waived or is estopped from exercising her right (if any) to claim interest against the 2nd Defendant under the alleged 1st and/or 2nd Credit Agreements (the existence of which is denied)[93].
(c) The Plaintiff had, by conduct, represented to the 2nd Defendant that she had no interest in seeking timely repayment of the Gaming Credit Indebtedness, and she would leave it to Sun City to decide whether to seek repayment, and, if so, the terms in respect thereof[94].
(d) The 2nd Defendant had suffered detrimental reliance and/or changed his position, in that he exclusively negotiated with and arranged repayments to Sun City in the belief that no interest would be charged[95].
(3) The material facts pleaded by the Defendants do subsume the following assertions: -
(a) The Plaintiff participated in the 2 January 2016 Meeting. There, it was agreed that the 2nd Defendant should make repayment to Sun City directly (which was clearly a right belonging to the true creditor).
(b) The Plaintiff “knowingly allowed” Sun City to exercise the rights as a true creditor (ie to liaise with and deal with the 2nd Defendant for repayment of the Gaming Credit Indebtedness).
(c) The Plaintiff did not even pursue payment of interest against the 2nd Defendant (which was clearly a right belonging to the true creditor according to the Plaintiff’s case based on the alleged 1st and 2nd Credit Agreements).
(4) Based on the material facts as pleaded, it appears to me that it is open to the Defendants to contend that the Plaintiff had failed to “speak up” when Sun City exercised the rights as the true creditor of the Gaming Credit Indebtedness. It cannot be said that the material facts or conduct relating to the inaction or acquiescence on the part of the Plaintiff and her knowledge of the relevant events have been omitted.
95.I now address the substantive merits of the Defendants’ defence.
96.In my view, the Plaintiff must have unreasonably “stood by” and/or failed to “speak up”: -
(1) According to the Plaintiff’s case, pursuant to the alleged 1st and 2nd Credit Agreements, she is the true creditor in respect of the Gaming Credit Indebtedness. She has rights to collect repayment of the principal indebtedness as well as the overdue interest from the 2nd Defendant.
(2) However, at the 2 January 2016 Meeting, the parties clearly conducted themselves in a manner that was inconsistent with the suggestion that the Plaintiff is the true creditor in respect of the Gaming Credit Indebtedness. Not only did the parties agree that Sun City should deal with the 2nd Defendant for repayments directly and that the 2nd Defendant should make repayments to Sun City directly, the Plaintiff also failed to assert that the 2nd Defendant should pay her overdue interest.
(3) It is clear to me that the parties clearly conducted themselves on the basis that Sun City is the true creditor in respect of the Gaming Credit Indebtedness. This was why (i) the 2nd Defendant should make repayment to Sun City (as opposed to the Plaintiff); and (ii) as Mr Chau was content not to charge overdue interest against the 2nd Defendant, the 2nd Defendant was not required to pay overdue interest.
(4) I do not see any sensible reason why the Plaintiff did not “speak up” and assert her alleged entitlements as the alleged true creditor. In my view, at the time, the Plaintiff must have accepted that Sun City should be treated as the true creditor. This indeed explained her inaction throughout the years. As canvassed in paragraphs 59 and 83 above, when the Plaintiff liaised with the 1st and 2nd Defendants back in February 2019, her complaint was concerned with the HK$5 million bonus or difference relating to the Regalia Bay Property as opposed to the overdue interest accrued on the Gaming Credit Indebtedness. The Plaintiff only requested the 2nd Defendant to pay interest in the past 2 years in a telephone conversation that took place on 30 July 2019..
97.However, I am not of the view that the 2nd Defendant has satisfied the requirement of “detrimental reliance”: -
(1) The 2nd Defendant would be able to satisfy the requirement of detrimental reliance if he can show that had he been told that he was liable to pay overdue interest, he would have conducted the affairs in relation to the repayments differently (such as repaying the entirety of the Gaming Credit Indebtedness much earlier, such that the alleged overdue interest would have been kept to a minimum).
(2) However, the 2nd Defendant did not even come to court to testify, and there is no evidence from him as to (i) how he would have dealt with the matter and (ii) the financial means available to him at the time.
(3) In regard to (ii), it is incontrovertible that the 2nd Defendant struggled to make repayments, and it took him a few years to repay the entirety of the Gaming Credit Indebtedness.
(4) On the evidence available to the court, it appears that the 2nd Defendant struggled financially. In the absence of any concrete evidence from the 2nd Defendant, I am not satisfied that had he been told that overdue interest would be charged, he would have been able to repay the entirety of the Gaming Credit Indebtedness earlier, such that the alleged overdue interest would have been reduced substantially.
98.In the premises, had I accepted the Plaintiff’s primary case or alternative case, I would have held that the Defendants have failed to make out a defence based on estoppel by standing by (or estoppel by silence, inaction or acquiescence).
E4. The Plaintiff’s Claims against the 1st Defendant based on the 1st Cheque
99.I now address the Plaintiff’s claims against the 1st Defendant based on the 1st Cheque, which was dishonoured.
100.According to the respective pleaded case of the parties[96], the 3 Cheques were issued as security for the Gaming Credit Indebtedness.
101.The real dispute is whether the Gaming Credit Indebtedness is owed to the Plaintiff and/or Mr Si/Ms Lim (which is the Plaintiff’s case) or Sun City (which is the Defendants’ case).
102.Obviously: -
(1) If the Gaming Credit Indebtedness was owed to the Plaintiff and/or Mr Si/Ms Lim, they were the ones who were entitled to enforce the security by presenting the 3 Cheques for payments in the event of default.
(2) However, if the Gaming Credit Indebtedness was owed to Sun City, Sun City was the one who was entitled to enforce the security by presenting the 3 Cheques for payments in the event of default.
103.For the reasons elaborated in sections E1 and E2 above, I find that: -
(1) The creditor-debtor relationship in regard to the Gaming Credit Indebtedness was between Sun City and the 2nd Defendant, not between the 2nd Defendant and the Plaintiff/Mr Si/Ms Lim.
(2) The Plaintiff and the 2nd Defendant had not entered into any contractual dealing on a personal basis in relation to the Gaming Credit Indebtedness.
(3) The Plaintiff had not, as agent of Mr Si and/or Ms Lim, entered into any contractual dealings with the 2nd Defendant in relation to the Gaming Credit Indebtedness.
(see paragraphs 68 and 88 above)
104.Accordingly, it follows that the party who was entitled to enforce the security by presenting the 3 Cheques for payments in the event of default was Sun City. This was indeed the position expressly set out in the 8 August 2019 Letter[97].
105.In the premises, I accept the Defendants’ submissions that (i) the Plaintiff is not the holder of the 3 Cheques; and (ii) the 3 Cheques were conditional upon the Plaintiff duly handing them over to Sun City. As mentioned, the 3 Cheques were issued to secure the Gaming Credit Indebtedness owed to Sun City, not the Plaintiff/Mr Si/Ms Lim. As such, the Plaintiff should not have, instead of delivering or forwarding the 3 Cheques to Sun City, filled in her name as the payee in the 1st Cheque and presented the same for payment. These rights were only exercisable by Sun City in the event that there was a default on the part of the 2nd Defendant.
106.I also accept the Defendants’ submissions that the 3 Cheques were void and/or unenforceable for want of consideration by virtue of section 27 of the Bills of Exchange Ordinance (Cap 19). Having said that the Gaming Credit Indebtedness was owed to Sun City and that the underlying contractual dealings were between Sun City and the 2nd Defendant, the Plaintiff did not provide any “valuable consideration” within the meanings of section 27(1) of the Bills of Exchange Ordinance.
107.For all the above reasons, I reject the Plaintiff’s claims against the 1st Defendant based on the 1st Cheque.
E5. Quantum
108.For the reasons elaborated in sections E1, E2, and E4 above, the Plaintiff’s claims against the 1st and 2nd Defendants are liable to be dismissed.
109.However, had I accepted the Plaintiff’s primary case or alternative case, I would have:-
(1) entered judgment against the 1st Defendant based on the 1st Cheque to the extent of HK$60 million and awarded pre-judgment interest from 7 August 2015 onwards at 1% above HSBC prime rate; and
(2) allowed the Plaintiff’s claim against the 2nd Defendant for overdue interest based on the alleged 1st and 2nd Credit Agreements.
110.Insofar as the calculation of the overdue interest is concerned, I have no quarrel with the arithmetic set out in paragraph 140 of Mr Keith Lam’s opening submissions.
111.Nevertheless, I am of the view that the calculation should take into account the HK$10 million, which the 2nd Defendant paid in order to enable the Plaintiff to acquire the Regalia Bay Property. There is no question that the Plaintiff took benefit of this sum. Indeed, the verification/calculation exercise (對數) at the 2 January 2016 Meeting was conducted on the basis that the Plaintiff had already collected HK$153 million (not HK$143 million) from the 2nd Defendant[98]. Further, the 8 August 2019 Letter[99] also shows that the sum of HK$10 million was counted towards the 2nd Defendant’s repayment of the Gaming Credit Indebtedness[100].
F. Disposition
112.For the reasons elaborated in Section E above, I dismiss all the Plaintiff’s claims against the 1st and 2nd Defendants in the original action.
113.However, I do not propose to grant any relief in relation to the 1st Defendant’s counterclaims[101]. I am not of the view that it is necessary to grant any declaratory and/or injunctive relief in relation to the 3 Cheques. Whilst my findings set out in Section E4 are self-explanatory, by now, the 3 Cheques have expired for years already.
114.Costs should follow the event.
115.I make a costs order nisi that the Plaintiff shall pay the 1st and 2nd Defendants’ costs in these proceedings (including all costs reserved) to be taxed if not agreed (with certificate for 2 counsel).
116.Mr Keith Lam, Mr Cedric Yeung, Mr Alexander Tang, and Ms Regina Yip provided able and helpful assistance to me at the trial. I express my gratitude to each of them.
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( Alan Kwong )
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Deputy High Court Judge |
Mr Keith Lam and Mr Cedric Yeung, instructed by M/s ELLALAN, for the Plaintiff
Mr Alexander Tang and Ms Regina Yip, instructed by M/s Fangda Partners for the 1st and 2nd Defendants
[1] 25 to 28 February 2015
[2] The initial complete date in respect of the sale and purchase of the Regalia Bay Property was 10 September 2015.
[3] See Plaintiff’s witness statement, para 4; Plaintiff’s opening submissions, para 2
[4] See paras 55.2 and 57.1 of
[5] See Plaintiff’s witness statement, para 93(4). The fact that the 2nd Defendant had telephone call with Mr Si before gaming credits were provided was not seriously in dispute.
[6] See re-amended statement of claim, paras 11 to 12
[7] See para 83.2
[8] See re-amended statement of claim, para 13
[9] In my view, it is, in theory, plausible that a third party. who does not provide the money or credit to the debtor, would agree with the debtor that the debtor shall pay interest to itself on the sum or credit provided by the creditor. However, this kind of arrangement would be unusual.
[10] See Bundle C2, page 537
[11] This referred to Mr Si
[12] This referred to Crown
[13] Bundle C1, page 419
[14] This referred to Mr Si
[15] This referred to Crown
[16] Bundle C1, page 420
[17] Plaintiff’s supplemental witness statement, para 55.2
[18] Plaintiff’s supplemental witness statement, para 57.1
[19] In the present context, the money obviously referred to the gaming credit that was granted.
[20] Ditto
[21] Bundle C2, page 561
[22] Bundle C2, page 603
[23] Day 2, after lunch
[24] Day 2, after lunch
[25] Bundle C1, page 369
[26] Bundle C1, page 377
[27] Bundle C1, page 377
[28] See Plaintiff’s witness statement, para 87
[29] Bundle C1, page 367
[30] This referred to the 2nd Defendant
[31] Bundle C1, page 383
[32] Plaintiff’s witness statement, para 56
[33] Bundle D, page 191 (line 34 of the transcript)
[34] In gist, the Plaintiff’s response was that the 2nd Defendant knew about his obligations and that interest kept accruing. I do not accept the Plaintiff’s explanation, which was hardly convincing. As an alleged creditor, the Plaintiff had every reason to sort out the matter and secure repayment to herself as soon as possible.
[35] This referred to Crown
[36] This referred to Sun City
[37] Bundle C, page 462
[38] This referred to Mr Si
[39] Bundle C, pages 463 to 464
[40] This referred to the 2nd Defendant
[41] Bundle C1, page 463
[42] See transcript produced at Bundle D, pages 45 to 62
[43] Bundle C1, pages 313 to 314
[44] Bundle D1, pages 12, 24 to 26
[45] It appears that this was because Crown was willing to offer concession and to charge at a favourable interest rate.
[46] Bundle C2, page 603
[47] Bundle C1, pages 273 to 275.
[48] Day 1, before morning break
[49] Bundle C1, page 309
[50] The Deed of Release was executed by 太陽城博彩中介一人有限公司. This is the Chinese name of Sun City.
[51] See re-re-amended defence & counterclaim, para 23.
[52] Bundle C2, page 603
[53] This is the Chinese name of the Plaintiff
[54] See para 2 of the Plaintiff’s affirmation filed on 11 October 2022 for answering interrogatories.
[55] Bundle C1, page 313
[56] Bundle D, page 45
[57] See footnote 64 below. It appears that the profits earned by the Plaintiff and Mr Si (who were business partners) in the transactions relating to the gaming credit was HK$113.9 million, and Mr Chau appeared to accept that the Plaintiff could retain this sum (which was to be shared with Mr Si).
[58] It appears that the figure of HK$39.1m came about in the following way. It was agreed that the 2nd Defendant lost HK$333.9 million (Bundle C1, page 313) and that the sum that Sun City had to pay Crown was HK$220 million (Bundle D, page 45). When HK$220m was deducted from HK$333.9 million, the figure was HK$113.9 million. As mentioned, it is not in dispute that the Plaintiff had already received HK$153 million from the 2nd Defendant. Thus, when HK$113.9 million was deducted from HK$153 million, the net figure was HK$39.1 million. This was exactly the sum that the Plaintiff should pay Mr Chau and/or Sun City. For completeness, it should be mentioned that it appears that Sun City did not earn a profit from the transactions, and this was why Mr Chau mentioned that he did not earn anything (even handling fee); all he did was to collect the outstanding sum and handed over the same to Crown: see transcript of 2 January 2016 Meeting at Bundle D, page 59 (lines 2 to 4). In the circumstances, it seems that the profits earned by the Plaintiff and Mr Si (who were business partners) in the transactions relating to the gaming credit was HK$113.9 million.
[59] This was what the Plaintiff said when she gave oral evidence: Day 2, after morning break.
[60] As mentioned, it is the Plaintiff’s pleaded case that Sun City would look to Mr Si and Ms Lim for repayment: see re-amended statement of claim, paras 11, 12, and 20. Nowhere was it pleaded that Sun City would look to the Plaintiff for repayment.
[61] See footnote 64 above.
[62] This referred to the 2nd Defendant.
[63] This referred to the Regalia Bay Property
[64] Bundle C1, page 328
[65] Bundle C1, page 315
[66] See Plaintiff’s opening submissions, para 2; Plaintiff’s witness statement, para 4
[67] See Plaintiff’s witness statement, para 2(5)
[68] See for instance the recorded telephone conversation between the 2nd Defendant and Mr Si on 30 July 2019 (Bundle D, page 184). Mr Si talked about sharing profits or junket commissions with the Plaintiff on a 50:50 basis.
[69] See eg C1/464 and D/190
[70] In my view, the truth was either that (i) the 2nd Defendant did not bother to take the trouble to travel to Hong Kong to testify or (ii) there were some reasons why the 2nd Defendant did not wish to come to Hong Kong, but he was not frank with the court about these reasons.
[71] See footnote 64 above. As mentioned, based on the transcript of the calculation/verification exercise at the 2 January 2016 Meeting, it appears that Mr Chau and/or Sun City accepted that the Plaintiff and Mr Si (who were business partners) were entitled to pocket the profit arising from the transactions relating to the gaming credit in the amount of HK$113 million.
[72] See para 83.2
[73] 男哥 referred to Mr Si.
[74] Bundle C1, page 437
[75] This obviously referred to the Plaintiff.
[76] Bundle D, page 180
[77] Bundle D, pages 181 to 182
[78] Bundle D, page 184
[79] Day 2, after lunch
[80] Day 2, after lunch
[81] Day 2, after lunch break
[82] See re-amended statement of claim, paras 15 and 22.
[83] Day 3, before morning break
[84] When Madame Lim gave oral evidence, she said that she asked the Plaintiff to buy jewellery for herself, to invest the sums in family business, and to invest in properties.
[85] Bundle D, page 202
[86] See the WeChat message produced at Bundle C2, page 603
[87] Bundle C2, page 603
[88] See Bundle C2, page 561. The WeChat message from the Plaintiff on 2 March 2020 shows that the line of credit that Mr Si maintained with Sun City was under account “BB2”
[89] Bundle C1, pages 273 to 275
[90] Bundle C1, pages 238 to 243
[91] Day 3, before morning break
[92] Paragraph 30(2)
[93] Paragraph 31A
[94] Paragraph 31A(1)
[95] Paragraph 31A(2)
[96] See re-re-amended statement of claim, para 29.1; and re-re-amended defence & counterclaim, para 26
[97] Bundle C2, page 603
[98] See footnote 64 above.
[99] Bundle C2, page 603
[100] The 8 August 2019 Letter states that the sum collected by the Plaintiff was HK$153 million, not HK$143 million. This obviously took into account the HK$10 million in question.
[101] The 1st Defendant has brought various counterclaims seeking declaratory and injunctive relief in relation to the 3 Cheques.
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